Surge in Insurance Complaints Highlights Industry Challenges

Home-building insurance complaints have escalated to 24 per day in the first quarter of 2026, marking the highest level since the 2022-23 period. Similarly, motor vehicle insurance complaints have risen to 44 per day, up from 31 daily complaints in the previous financial year. These figures underscore a growing dissatisfaction among policyholders regarding the timeliness and efficiency of claim handling.

Emma Curtis, AFCA's lead ombudsman for insurance, identifies several factors contributing to these delays. A notable shortage of materials and skilled labour, particularly in the construction and automotive sectors, has been exacerbated by rising fuel and freight costs. This situation is further strained by the increasing prevalence of electric vehicles, which require specialised parts and expertise, leading to longer repair times and extended claim processing periods.

Internal complaints within general insurers have also seen a significant uptick, rising from 1.6 million in 2023-24 to nearly 2.1 million in 2024-25, as reported by the Australian Securities and Investments Commission (ASIC). Alarmingly, nearly 40% of complaints escalated to AFCA had not been logged internally by the insurers, indicating potential gaps in internal complaint management systems.

In response to these challenges, the Insurance Council of Australia (ICA) reports that insurers processed an average of 86,000 motor and household insurance claims daily in 2025. Despite these efforts, the ICA acknowledges that delays are likely to persist due to ongoing global events impacting supply chains and repair timelines.

For real estate professionals, these developments highlight the critical importance of comprehensive insurance coverage and proactive risk management strategies. Ensuring that policies are up-to-date and that claims processes are clearly understood can mitigate potential disruptions. Additionally, maintaining open communication with insurers and staying informed about industry trends can aid in navigating the complexities of the current insurance landscape.