Broker Complaints Less Than 1% as Case Numbers Reach Record Highs, Notes AFCA

Out of the 104,861 complaints to AFCA, just 584 were related to insurance brokers.

The Australian Financial Complaints Authority (AFCA) reported a record surge in consumer and small business complaints during the 2023-24 year, with numbers reaching a record 104,861 cases—an 8% increase from the previous year. However, out of the 104,861 complaints, just 584 were related to insurance brokers.

In his address at the 2024 NIBA Convention, AFCA CEO and Chief Ombudsman David Locke highlighted the low volume of broker complaints.   

"Out of the more than 104,000 complaints referred to us, only 584 were about insurance brokers," Mr Locke said.  

"Compared to the more than 29,000 complaints about general insurance we saw in the same year, your volumes are very small," Locke noted in his address at the Convention.  

According to the 2023-24 AFCA Annual Review, scams were a significant driver, representing 10% of all complaints.  

Despite the alarming increase, AFCA observed a positive shift in the last quarter of 2023-24, with scam complaint numbers declining.   

"Although AFCA received on average 900 scam complaints per month during 2023-24, the final three months showed a marked drop to around 500 complaints monthly, a trend that continues into the new financial year," Locke said.   

He attributed this improvement to initiatives such as the Federal Government's National Anti-Scams Centre and measures like bank account name verification. He also welcomed the newly announced Scams Prevention Framework, emphasising the need for mandatory codes of conduct.  

Locke underscored AFCA's readiness to support a broader role in external dispute resolution across banking, telecommunications, and digital platforms. He urged companies not to wait for new regulations but to safeguard consumers proactively.   

"Banks, digital platforms, and telecommunications companies need to act now to protect consumers. More must be done to mitigate operational risks linked to digital payment platforms," Locke said.  

The 2023-24 AFCA Annual Review also highlighted a concerning rise in complaints about financial difficulty, which surged by 18%. Issues surrounding inadequate responses to hardship applications, particularly in home, personal, and credit card lending, were frequently noted. "Too many complaints involve poor treatment or ineffective communication during the hardship process. Urgent improvements are needed," Locke stressed.  

Consumers in the general insurance sector, facing record premium increases in car and home insurance, was another area of concern. 

AFCA called for better resourcing, improved product design, and an emphasis on a resolution-focused approach to reduce persistent high complaint levels.  

Locke urged all firms to adopt a cooperative mindset when handling complaints, especially in complex cases like scams, to support better consumer outcomes.  

You can access the 2023-24 AFCA Annual Review here.