The General Insurance Code of Practice: Claims Rules Explained

The General Insurance Code of Practice is the Insurance Council of Australia's industry code, monitored by the independent Code Governance Committee. For retail claims it sets firm timeframes: tell the claimant what is needed within 10 business days, update them at least every 20 business days, and decide within 4 months unless an exception applies.

This article is general information, not legal or compliance advice. Check the current text of the code, standard or legislation, and take advice for your situation.

Key takeaways

• The Code's claims rules in Part 8 apply to retail insurance, including motor, home, contents, travel and small business cover.
• A decision is due within 10 business days of having all the information, and within 4 months of the claim in most cases.
• According to the Code Governance Committee, claims caused 59% of the 70,325 Code breaches recorded in 2024-25.
• According to Insurance Business, the Insurance Council planned to lodge a redrafted Code with ASIC in late October 2026, with an enforceable code expected in 2028.
• A claims supplier contracted by an insurer, including a broker managing claims for it, is bound by the Code as a Service Supplier.

What is the General Insurance Code of Practice?

The General Insurance Code of Practice is a set of standards that subscribing general insurers agree to follow. The Insurance Council of Australia publishes it, and the independent Code Governance Committee monitors and enforces it. It covers buying insurance, claims, vulnerability, financial hardship and complaints. Claims teams feel it most.

The Code has existed since 1994 and is reviewed regularly. The version in force is the 2020 Code, which took effect from 1 January 2020. Insurers had 12 months to adopt it, and it has been amended since. Its claims rules sit in Part 8, its vulnerability rules in Part 9 and its complaints rules in Part 11.

Paragraph numbers below are from the 2020 Code text. Because the Code has been amended, check the current version on the Insurance Council's website before relying on a paragraph number.

Who does the Code apply to?

The Code applies to insurers that have adopted it, and through them to their employees, distributors and service suppliers. A service supplier includes anyone contracted to manage claims on the insurer's behalf. That covers a TPA, a loss adjuster, an investigator, or a broker managing claims for the insurer.

That reach matters for anyone handling claims for an insurer. Under Part 5, a service supplier must tell the insurer about any Code breach it becomes aware of within 2 business days. So an underwriting agency or TPA working for a subscribing insurer works to the Code, even though it has not adopted the Code itself.

The claims rules in Part 8 apply to retail insurance products only. The Code defines those as motor, home building, home contents, sickness and accident, consumer credit, travel and personal property insurance. They count as retail when provided to an individual or a small business. A small business means fewer than 100 employees for a manufacturer, and fewer than 20 otherwise. Wholesale commercial claims fall outside Part 8.

What does the Code require in claims?

Part 8 sets a clear sequence of deadlines. Within 10 business days the insurer tells the claimant what it needs and how long a decision should take. It then updates them at least every 20 business days. Finally, it decides within 10 business days of having everything, and within 4 months of the claim.

• Tell the claimant what information is needed, appoint any assessor and estimate the timeframe. Timeframe: Within 10 business days of receiving the claim; 2020 Code paragraph: 68.
• Update the claimant on progress. Timeframe: At least every 20 business days; 2020 Code paragraph: 70.
• Respond to routine enquiries about progress. Timeframe: Within 10 business days; 2020 Code paragraph: 71.
• Tell the claimant a loss assessor or adjuster has been appointed. Timeframe: Within 5 business days of appointing them; 2020 Code paragraph: 72.
• Ask an external expert to report. Timeframe: Within 12 weeks of engaging them; 2020 Code paragraph: 74.
• Decide the claim once all information is in and enquiries are done. Timeframe: Within 10 business days; 2020 Code paragraph: 76.
• Decide the claim overall. Timeframe: Within 4 months of receiving it, unless paragraph 78 applies; 2020 Code paragraph: 77.

Paragraph 78 allows up to 12 months in set circumstances. Those include an extraordinary catastrophe, a suspected fraud or a claimant who does not respond to reasonable requests. They also cover communication difficulties beyond the insurer's control, and a claimant asking for a delay. If the 4 month deadline passes, paragraph 77 requires the insurer to tell the claimant in writing about its complaints process.

The quick reference to Code timeframes lays these out for daily use.

How does the Code treat vulnerable customers and financial hardship?

The Code asks insurers to take extra care with customers experiencing vulnerability, and to support customers in financial hardship. Part 9 covers vulnerability, recognising that it can come from age, disability, illness, family violence and other factors. Part 10 covers financial hardship, and Part 8 adds fast-tracking for claimants in urgent financial need.

For claims teams, the practical effect is that one process does not fit every claimant. A claimant experiencing family violence, for example, may need contact handled differently and information kept from a joint policyholder. An event such as a natural disaster can leave a claimant in urgent financial need. Under paragraph 64, that claimant can be entitled to a fast-tracked decision, an advance payment or both. The Code expects these needs to be identified and acted on, not left to an individual handler's judgement.

What happens with complaints and breaches?

When a claimant complains, Part 11 sets how the insurer must acknowledge, update and decide the complaint. If the claimant remains unhappy, the insurer refers them to AFCA. Breaches of the Code are reported to and monitored by the Code Governance Committee, which can impose sanctions on insurers for serious failures.

The volumes are rising. According to AFCA, general insurance complaints rose 5% to 36,022 in 2025-26, and delay in claim handling was the most common issue. According to the Code Governance Committee, Code breaches rose 20.5% to 70,325 in 2024-25. Of those, 41,140, or 59%, were claims breaches under Part 8.

The single largest problem was communication. According to the Code Governance Committee, insurers breached the 20 business day update requirement 18,350 times in 2024-25, up 67%. Insurers attributed 77% of all breaches to staff negligence or error. In addition, the committee oversaw more than $2.9 million in remediation to 13,528 consumers. The AFCA and claims disputes looks at what drives those complaints.

How can a claims team build the Code into its workflow?

The Code's deadlines are easiest to meet when they are steps in the process rather than things to remember. Take a claim that triggers its own 10 business day request and its own 20 business day update reminder. It is far less likely to miss one than a claim tracked in a handler's diary.

That matters because the breach data points at process, not knowledge. Most claims staff know the 20 business day rule, yet it was breached 18,350 times in one year. As a result, the fix is usually structural. Deadlines are calculated from the claim date, updates are prompted before they fall due, and the claimant's update is recorded.

Configurable claims platforms let a team build those steps in. For example, ClaimsGateway (claimsgateway.com) lets the business configure its own workflows without developers. A team can therefore set up the Code's deadlines as steps in each claim. No software makes an insurer compliant, however. The process, the people and the insurer's own oversight still decide whether every deadline is met.

What is changing in the Code?

The Code is being redrafted. According to Insurance Business, the Insurance Council opened consultation on a redrafted Code in June 2026 and received 28 submissions. Its central change would make key obligations legally enforceable as part of insurance contracts, subject to ASIC approval. An enforceable code is expected to start in 2028.

The redraft follows an independent review of the Code finalised in December 2024, and the parliamentary inquiry into insurers' responses to the 2022 floods. According to Insurance Business, the lodgement with ASIC was pushed back to late October 2026, the second delay to the timetable. Until a new Code takes effect, the 2020 Code's timeframes remain the ones claims teams work to.

For claims teams, the likely direction is clear even before the final text: obligations that are enforceable, and therefore need evidence. A claims process that already records every deadline met is better placed for that change than one that relies on memory.

Frequently asked questions

How long does an insurer have to decide a claim under the Code?

Under the 2020 Code, an insurer must decide within 10 business days of having all the information it needs, and within 4 months of receiving the claim. Paragraph 78 allows up to 12 months in set cases, such as an extraordinary catastrophe, suspected fraud or a claimant who does not respond to requests.

Is the General Insurance Code of Practice legally binding?

Today the Code is a voluntary industry code that subscribing insurers commit to, monitored by the Code Governance Committee. However, the redraft under way would make key obligations legally enforceable as part of insurance contracts, subject to ASIC approval. According to Insurance Business, an enforceable code is expected to start in 2028.

Does the Code apply to underwriting agencies and TPAs?

Yes, through the insurers they work for. The Code defines a Service Supplier to include anyone contracted to manage claims on an insurer's behalf, which covers TPAs and agencies handling claims. A Service Supplier must also tell the insurer within 2 business days about any Code breach it becomes aware of.

What happens when an insurer breaches the Code?

Insurers report breaches to the Code Governance Committee, which monitors compliance and can impose sanctions for serious or repeated failures. In 2024-25 it recorded 70,325 breaches and oversaw more than $2.9 million in remediation to 13,528 consumers. Anyone can also report an alleged breach to the committee at any time.

What changed in the latest version of the Code?

The 2020 Code took effect from 1 January 2020 and has been amended since. A redrafted Code went to public consultation in June 2026, and its main change would make key obligations legally enforceable. According to Insurance Business, the Insurance Council planned to lodge it with ASIC in late October 2026.

About the author

ClaimsGateway builds cloud claims management software for insurers, underwriting agencies, brokers, TPAs and self-insured organisations in Australia and New Zealand. Every regulator figure in this article links to its source, and every vendor fact was checked on the vendor's own site on the date shown.

Related reading

• ASIC's claims handling regime: claims handling as a licensed financial service.
• New Zealand's Fair Insurance Code: the claims obligations across the Tasman.
• Claims software for insurers: systems compared for insurer claims teams.

Sources

1. Insurance Council of Australia. General Insurance Code of Practice (2020 Code), Parts 2, 5, 8, 9, 10, 11 and 13. https://insurancecouncil.com.au/code-of-practice
2. Insurance Business Australia. "Record AFCA complaints mask a worse story in insurer compliance data." 4 August 2026. https://www.insurancebusinessmag.com/au/news/breaking-news/record-afca-complaints-mask-a-worse-story-in-insurer-compliance-data-584812.aspx (reports AFCA's 2025-26 figures and the Code Governance Committee's 2024-25 data)
3. Insurance Business Australia. "ICA delays Code lodgement as industry-consumer divide deepens." 2026. https://www.insurancebusinessmag.com/au/news/breaking-news/ica-delays-code-lodgement-as-industryconsumer-divide-deepens-584518.aspx
4. Insurance Business Australia. "General Insurance Code consultation closes as reform pressure builds." 2026. https://www.insurancebusinessmag.com/au/news/breaking-news/general-insurance-code-consultation-closes-as-reform-pressure-builds-583644.aspx