Insurers, administrators and other entities providing services to superannuation funds have been placed on notice by the Australian Securities and Investments Commission (ASIC) that they will need to live by the new and significantly shorter 45-day complaints handling timeframe.
ASIC has reinforced with superannuation fund trustees the need to get their houses in order on internal dispute resolution (IDR) operating on a similar basis to financial planning companies and in line with the 45-day time-frame which has been reduced from 90 days, including employing more people and getting their information technology systems upgraded.
ASIC said that, if they had not already done so, superannuation trustee boards should seek advice on how their operations would meet the requirements of Regulatory Guide 271 (RG 271).
“Some of the changes may take some time to implement. These may include necessary changes to information technology (IT) and administration systems for complaints management, including capturing data, processes and procedures, and staff training,” it said.
“Trustees will also need to review their insourced and outsourced arrangements, which may require contractual and/or operational changes in order to meet the requirements of RG 271,” ASIC said. “Any third parties involved in handling complaints (including an insurer for claim related complaints) will need to be able to meet the shortened 45-day maximum timeframe (from 90 days) to resolve complaints and to meet the data collection and reporting requirements.”
“As for external providers, under the design and distribution obligations, which also commence on 5 October 2021, product distributors must record and report the number of complaints they receive. Trustees are responsible for outsourced providers and must ensure there is clear oversight of these arrangements.
“We anticipate the new IDR standards may require trustees to invest in skilled staff and systems. Trustees may need to revisit how they structure delegations, including authority to make decisions and financial delegations, to ensure relevant staff are sufficiently empowered to resolve complaints fairly and efficiently, and to avoid delays in resolving complaints under the shorter timeframes.
“Trustees should also take into account the fact that levels and complexity of complaints can fluctuate, so they should consider how they use flexible resourcing,” ASIC said.