The television and other media advertising campaigns pursued by plaintiff law firms have had a genuine impact on claims hitting the life insurance industry, according to the Australian Prudential Regulation Authority (APRA).
Giving evidence before the Parliamentary Joint Committee inquiry into the life insurance industry, senior APRA executives confirmed the impact that law firms were having on the life insurance sector and the degree to which this had skewed industry modelling.
Queensland Liberal Party member, Bert van Manen suggested to the APRA executives that increased consumer awareness of their insurance, particularly insurance inside superannuation, had been a result of the advertising activities of the legal profession.
APRA member and former insurance industry executive, Geoff Summerhayes agreed that the advertising by lawyers had “absolutely [been] a factor”.
APRA general manager, Adrian Rees later told the committee that insurers had reported to APRA that they were seeing more frequent incidence of lawyers being involved in claims generally.
“They have said that they [lawyers] are getting involved earlier in the claims process – not waiting, if you like, for the claim to get to a point of disputation. Instead, sometimes the first contact relating to a claim happening is actually a letter from a lawyer saying, ‘our client is claiming’,” Rees said.
