Australian insurance law is a term which refers to the body of law which regulates the insurance industry and insurance contracts within Australia. Commonwealth Parliament gains authority to make laws with respect to insurance and insurance companies under section 51 XIV and XX of the Australian Constitution. Generally, the Insurance Act 1973 and Insurance Contracts Act 1984 are the main acts to which the body of law refers, however there are a number of other pieces of legislation enacted by the states, private codes and volumous case law all of which forms this body of law.
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The Insurance Act 1973 (Cth) requires minimum levels of capital and solvency for companies wanting to enter the insurance market and for insurers in the market.[1]
Chapter 7 of the Corporations Act 2001 (Cth) regulates the way in which insurers and insurance agents and brokers carry on business and how they deal with the people they do business with and intend to do business with.
The Insurance Contracts Act 1984 applies to most insurance contracts with an Australian connection and is intended to ensure that a fair balance is struck between the interests of the insurer and the insured.
The Australian Prudential Regulation Authority (APRA) has the power pursuant to the 'Insurance Act 1973 to investigate a general insurer, freeze its assets or direct it to take specific action (for example, stop writing new business).
The Australian Securities and Investment Commission (ASIC) is responsible for the general administration of the ICA.[2]
The formation of an insurance contract is governed by ordinary contractual principles.[3]
The General Insurance Code of Practice is a self regulatory code that binds all general insurers who are signatories to it. It has been approved by ASIC pursuant to s 1101A of the Corporations Act 2001 (Cth).[4]
If a person doesn't agree with the outcome of the insurer's Internal Dispute Resolution (IDR) process, they can contact the Financial Ombudsman Service with a request that the Service resolve the dispute.