Log in or register
Share on LinkedInShare on LinkedIn

ARTICLE · 29 JUNE 2026

#5 Financial Services Royal Commission Concerns Regarding Trauma Cover

Carroll & O'Dea
Explore more from Carroll & O'Dea

The Financial Services Royal Commission uncovered serious deficiencies in Australia's trauma insurance sector, revealing how complex policy terms, problematic sales practices, and unfair claims handling have left many policyholders vulnerable. With eight out of ten life insurers admitting failures in updating medical definitions, the Commission's findings expose systemic issues that continue to affect claimants seeking critical illness coverage.

AustraliaInsurance
David Coorey
David Coorey
Author LinkedIn connections

The Financial Services Royal Commission (FSRC), formally the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, has cast a critical spotlight on Australia’s financial services sector. Among its many areas of scrutiny, trauma cover also known as critical illness insurance has emerged as a significant concern.

The Commission’s findings highlighted multiple issues, including complex policy terms, problematic sales practices, difficulties in claims handling, and gaps in regulatory oversight. Eight out of ten life insurers admitted deficiencies in reviewing and updating medical definitions in their trauma insurance policies.

Complexity and clarity of policy terms

We operate a free-to-view policy, asking only that you register in order to read all of our content. Please login or register to view the rest of this article.

Register for freeORLog in

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

View source

Related Articles

Legal Intelligence Newsletters: sign up for the latest legal and regulatory news on your chosen topics

Read more about

Related Comparative Guides

See more popular content from

Article

AFCA’S New Approach To General Insurance Claims Handling: GICOP Compliance May Not Be Enough

The Australian Financial Complaints Authority has published new guidance clarifying how insurers must handle claims, including strict timeframes and expanded compensation rules. Insurers now face potential liability beyond policy limits for unreasonable delays, and may be required to compensate claimants for non-financial losses. With storm season approaching and complaint volumes rising, these changes create significant operational and financial pressure on the insurance industry.
AustraliaInsurance
Gilchrist Connell
Gilchrist Connell
Article

The Data Centre Boom: Growth, Opportunity And Emerging Risk For The Insurance Industry

Data centres have become critical infrastructure assets in Australia's digital economy, attracting significant investment while facing mounting regulatory scrutiny over energy demands and infrastructure costs. As these facilities expand to meet AI-driven computing needs, they present complex insurance challenges spanning climate exposure, business interruption risk, and cyber vulnerabilities that require careful risk management strategies.
AustraliaInsurance
Kennedys
Kennedys
Article

ASIC Puts Motor Vehicle Premium Transparency Under The Spotlight

ASIC's Report 838 reveals significant transparency gaps in motor vehicle insurance premium communications, finding that renewal documents often fail to explain price changes adequately and that over 30% of consumers who contacted their insurer successfully negotiated lower premiums. The report establishes clear expectations for better practice in pricing disclosures and signals continued regulatory scrutiny of insurance pricing practices.
AustraliaInsurance
Gilchrist Connell
Gilchrist Connell
Article

A $2 Million “sting”: First Civil Penalty For Breach Of The Duty Of Utmost Good Faith

The Federal Court has imposed a $2 million civil penalty on Hollard Insurance Partners for breaching the duty of utmost good faith in its handling of a home insurance claim. This landmark decision marks the first time an insurer has faced civil penalties under section 13(2A) of the Insurance Contracts Act 1984, following sustained delays, inadequate expert engagement, and failures to properly assess storm damage that left policyholders in temporary accommodation for over three years.
AustraliaInsurance
Gilchrist Connell
Gilchrist Connell
Article

One Claim. $2 Million Penalty. A Warning To Every Insurer.

Australia's securities regulator has secured a landmark $2 million civil penalty against Hollard Insurance for breaching its duty of utmost good faith during a 17-month storm damage claim. The Federal Court found that repeated delays, inadequate expert assessment, and poor communication constituted a single contravention—even without deliberate misconduct. This precedent-setting decision signals that claims-handling failures on individual policies can now trigger seven-figure penalties, fundamentally
AustraliaInsurance
Kennedys
Kennedys
Article

When Is A Loss Not A Loss? Federal Court Examines Insurance Policy Exclusions

The Federal Court of Australia has determined that ANZ was not entitled to insurance coverage for nearly $117 million in class action settlements and defense costs, examining whether these settlements qualified as insured Loss under excess insurance policies. This landmark decision provides critical guidance on policy interpretation, particularly regarding when repayments of premiums, commissions and charges may fall outside insurance coverage, and how exclusions for excessive or improper charges should be
AustraliaInsurance
Hall & Wilcox
Hall & Wilcox
Article

From Sustainability To Supply Chains: Rethinking Data Centre Risk In APAC

Asia-Pacific data centre expansion is creating unprecedented insurance challenges as rapid infrastructure growth strains regional water and power resources. Could intensive resource consumption by data centres generate environmental liability claims from affected communities and regulators? And are traditional property insurance models adequately capturing the contingent business interruption risks created by concentrated digital infrastructure dependencies?
AustraliaInsurance
Kennedys
Kennedys
Article

Injured While Working As A Delivery Driver? New Protections For Gig Workers.

New minimum standards effective from 17 August 2026 introduce personal accident insurance requirements for delivery drivers and riders working through digital platforms like Uber Eats and Deliveroo. These protections address a critical gap for gig economy workers who, as independent contractors, have historically fallen outside traditional workers compensation schemes when injured on the job.
AustraliaEmployment and HR
Carroll & O'Dea
Carroll & O'Dea
Article

Long Service Entitlements In NSW

After five years of continuous service in New South Wales, employees may qualify for pro rata long service leave payments under specific circumstances—even before reaching the standard 10-year threshold. Understanding when these entitlements arise, particularly in cases of illness, incapacity, or pressing necessity, can significantly impact both employees facing career transitions and employers managing termination obligations.
AustraliaEmployment and HR
Carroll & O'Dea
Carroll & O'Dea
Article

Case Note On Australian Capital Territory (Represented By ACT Education Directorate) v Jack Gibson [2026] FWCFB 110

Mr Gibson was employed as a teacher in an ACT high school from January 2023 until his dismissal on 30 August 2024. It was alleged that he initiated and engaged in extensive ongoing electronic communications with female students on social media, drove students to and from non-school related sporting events, and took a photo of students (who were clothed) in an ice bath.
AustraliaEmployment and HR
Carroll & O'Dea
Carroll & O'Dea
Article

The Scope Of A School’s Duty Of Care Revisited

An 11-year-old student suffered a back injury during a long jump trial at a school athletics carnival, leading to a significant Court of Appeal decision that clarifies schools' duty of care obligations. The case examines whether basic safety measures like adequate sand depth and regular pit maintenance constitute reasonable precautions that schools must take to protect students during sporting activities.
AustraliaConsumer Protection
Carroll & O'Dea
Carroll & O'Dea
Article

AI Glasses And Privacy: Are Our Laws Keeping Up?

Australia's new statutory tort for serious invasions of privacy, which commenced in June 2025, is being tested against emerging AI-powered smart glasses technology that can record audio and video discreetly. As these devices become more sophisticated and less detectable, questions arise about whether current privacy laws adequately protect individuals from covert surveillance and data collection in both public and private settings.
AustraliaPrivacy
Carroll & O'Dea
Carroll & O'Dea
Article

2026 Tour De France: Anti-Doping Polices And Enforcement In The Spotlight

The 2026 Tour de France sparked unprecedented controversy when top competitors Jonas Vingegaard and Tadej Pogacar underwent overnight anti-doping tests on the eve of a crucial stage, raising questions about testing protocols and athlete rights. Following Vingegaard's race-ending crash the next day, the cycling world debated whether the disruptive testing procedures violated established standards and contributed to the incident. This examination explores the complex hierarchy of anti-doping authority, the le
FranceMedia, Telecoms, IT, Entertainment
Carroll & O'Dea
Carroll & O'Dea
Article

Can I Return To Work While I Am Receiving Workers Compensation Benefits?

Injured workers in New South Wales often wonder whether they can continue receiving workers compensation benefits while returning to their job. The workers compensation scheme actively encourages safe return to work where medically appropriate, but the process involves careful management of medical certificates, suitable duties, injury management plans, and rehabilitation providers to ensure both recovery and proper benefit calculations.
AustraliaEmployment and HR
Carroll & O'Dea
Carroll & O'Dea