ASIC's 2026-27 Priorities Letter to General Insurers Targets 'Disaster Chasers', Unclear Motor Renewal Notices and Cash Settlements After Cyclone Jasper

Australia's corporate and financial services regulator has set out what it will look at in the general insurance industry over the year to mid-2027, and it names practices that affect ordinary policyholders: how motor renewal notices explain price changes, how insurers settle storm claims with cash, and a new group of firms that sell help with claims. The Australian Securities and Investments Commission (ASIC) sent a supervisory letter on its 2026-27 general insurance sector priorities, dated September 30, 2026, from Commissioner Alan Kirkland to insurer boards and executives. This article draws on the letter itself. It falls under ASIC's wider priority of improving outcomes for consumers and small business. The letter sets no firm deadlines beyond the start of one review and a consultation held in July 2026.

The first new item concerns what ASIC calls 'disaster chasers'. ASIC says it will review for-profit claims management firms that help consumers with home insurance claims. Its concerns include the firms' sales tactics, their fee and cancellation terms, the role they play in claims and complaints, and their relationships with repairers. The review began in the first quarter of 2026-27, which is July to September 2026, and ASIC will gather information from both insurers and the firms. The letter does not say how many firms there are or how much they charge, so we cannot size the problem. Homeowners who are approached after a disaster should know that their insurer handles claims without charging a fee for doing so, and that they can complain to the Australian Financial Complaints Authority, a point that is general background and not part of the letter.

The second new item is the General Insurance Code of Practice. The Insurance Council of Australia, the industry body, plans to ask ASIC to approve a new code after a public consultation in July 2026. ASIC will assess the draft against its Regulatory Guide 183 and consult stakeholders. A code sets standards of service that insurers promise to follow, and ASIC approval gives it more weight. The letter also says insurers may be included in ASIC reviews of the quality of sustainability reporting, corporate governance and financial reporting.

The letter then returns to two continuing concerns. The first is motor vehicle premium disclosure, which ASIC examined in a report numbered REP 838. According to the letter, no sampled insurer explained the key drivers of the premium or why the premium had changed. Renewal notices often did not make clear that paying the annual premium in one go could save 10% to 20% compared with paying in instalments. Five insurers did not compare changes in the excess or the insured value from one year to the next. ASIC gave individual feedback to insurers and will continue to monitor. It expects clearer quotes and renewals that explain the drivers of the premium, show how the excess, the level of cover and the payment method affect the price, state the cost of paying by instalments compared with annually, and highlight year-on-year changes. For consumers, this is practical: a renewal notice that shows the old and new excess and sum insured side by side makes it far easier to see whether a price rise is for the same cover.

The second continuing concern is cash settlements in home building claims following Cyclone Jasper. ASIC found that at least 63% of finalised home claims included a cash settlement, where the insurer pays an amount of money instead of arranging the repair. The offers were often based on quotes from the insurer's preferred suppliers, which raises doubts about whether the amount covers the real cost of repairs. ASIC also found that consumers needed clearer information about their settlements and review rights, that vulnerable consumers were not always identified or supported, and that insurers held insufficient data on how offers changed after a customer questioned them. ASIC called on all insurers to act and said it would monitor improvements through its supervisory program. The letter does not give the value of the settlements or how many claims were involved in absolute terms, and we do not estimate them.

How will ASIC work with other bodies? The letter says it will coordinate with the Australian Prudential Regulation Authority (APRA), the Australian Financial Complaints Authority and the General Insurance Code Governance Committee to avoid duplication. It will also work with other members of the Council of Financial Regulators on emerging cyber risks and on simplifying data collection under the council's Better Regulation Roadmap, and it invites insurers to share practical examples of unnecessary regulatory burden. The letter does not address add-on insurance or the general standards for claims handling in detail.

What should policyholders do? When a motor policy renews, compare the new excess, sum insured and premium with last year's and ask the insurer to explain any large change; check whether paying annually is cheaper than instalments, since the letter says the saving can be 10% to 20%. After a storm, be careful about accepting a cash offer without understanding what it covers, ask for the repair quote on which it is based and ask about the right to a review, and be wary of firms that approach you offering to manage a claim for a fee. What should insurers do? According to ASIC, boards and executives should treat the letter as a statement of expectations, and they should expect follow-up supervision. Readers can find the letter on ASIC's website. This article is a summary of a regulator's letter and is not legal or insurance advice.