CALI life code response backs half of Kell’s recommendations 

The Council of Australian Life Insurers (CALI) has released its formal response to the review of the Life Insurance Code of Practice and says it supports 47 of the 85 recommendations put forward in a review of the existing code by former ASIC deputy chair Peter Kell. 

Three more recommendations are “supported with the final decision by the independent Life Code Compliance Committee”, and in 15 cases it says the recommendation should be “refined or implemented differently”.  

In these cases, CALI says the industry’s approach “may better address the identified issue, avoid duplication with existing law or regulation, and reduce the risk of unintended impacts while preserving practical implementation”. 

A further 19 recommendations will be sent to one of four priority workstreams – covering mental health, First Nations issues, claims handling and funeral insurance – which CALI says is “a focused and structured process involving the appropriate stakeholders”.  

“This will allow the customer outcome, evidence base, related recommendations and implementation impacts to be considered before the final drafting position is settled.” 

Just one recommendation is not supported at all, relating to whether it would be beneficial to include definitions for other medical conditions in the guide and/or definitions that apply to other types of insurance products. 

“This may be because the proposed approach could create disproportionate or unintended impacts, duplicate existing legal or regulatory obligations, restrict customer choice, or not achieve the intended customer outcome,” CALI says. 

CALI chief executive Christine Cupitt says the council’s response sets out a comprehensive roadmap for how it will respond to the full Kell review. 

“To over half of the recommendations, we’re making our full response today,” Cupitt tells Professional Planner.  

“We’ve been very clear about the recommendations going to priority work streams. These are complex recommendations that take time to get right. They interact with existing law, they overlap with each other, and we want to make sure that we’ve got the right input in delivering the industry’s response.” 

Cupitt says CALI took 90 days after Kell’s final report landed on 30 June to work through each of the 85 recommendations individually.  

“Our action plan that we’re releasing today advances those substantial reforms.  

“We are supporting most of the recommendations, and others we are progressing through priority work streams that will conclude in the first half of 2027,” Cupitt says. 

Drafting of the revised code is expected to be completed at the end of 2027. 

Cupitt says CALI already had a sense of where the code needed to change, from ongoing engagement with consumer advocates, customers and financial advisers, well before Kell’s review began. 

“We did understand that people are looking for more compassionate support when they need it most,” Cupitt says.  

“We’re introducing stronger protections for people experiencing family and domestic violence. We knew that stakeholders are looking for more support for people experiencing financial difficulty, and one of a number of things that we had feedback on was access to a real person with the right knowledge to help during a claim. That’s something we’re committing to today as well.” 

The current code came into force in September 2023, and its own terms committed the industry to reviewing it in 2025. 

“It was only on foot for two years before we commissioned this review, and that was important,” Cupitt says.  

“We want to make sure the test of the code is what it delivers for customers, and we wanted to make sure the code that was implemented in 2023 was delivering the outcomes the industry intended.” 

Cupitt points to claims handling as the clearest evidence of the current code’s impact. Data published by APRA shows claims handling timeframes have improved across every channel and every insurer since the code took effect, and AFCA complaints about life insurance have stayed low. 

Cupitt says APRA does not draw an explicit line between the code and the improvement but says there is a clear correlation between the code’s introduction and the timing of the change. 

The code is a condition of CALI membership, and members’ compliance is monitored by the independent Life Code Compliance Committee, which runs thematic reviews and an annual data collection program, alongside consumer recourse through AFCA.  

CALI has committed to reviewing the revised code again five years after it takes effect. 

“Codes are regularly reviewed, so we do make sure that they’re delivering those strong protections and benefits to customers,” Cupitt says. 

“There will continue to be quite significant change to the code through this review, and we need time for it to bed down and understand how it’s working before commencing another review.”