AFCA receives hundreds of COVID-19 complaints for super
The Australian Financial Complaints Authority has received 791 COVID-19 complaints about superannuation during the 2019–20 financial year, with the majority relating to early access to super.
During the 2019–20 financial year, there were 80,546 complaints made to the Australian Financial Complaints Authority (AFCA), a 13.7 per cent increase in complaints compared with the 2018–19 financial year.
A total of $258.6 million was paid in compensation and refunds direct to consumers.
Credit and general insurance were the two highest complaint categories, representing 43 per cent and 24 per cent of all complaints, respectively.
Superannuation was the third highest category, accounting for 9 per cent of all complaints.
The biggest complaint issue for superannuation was delays in claim handling with 1,260 complaints made, followed by incorrect fees or costs, with 753 complaints in this category.
There were 648 complaints made in relation to service quality, 570 complaints made in regard to account administration errors and 556 complaints about the denial of claims.
Out of the total 80,546 complaints made over the year, 4,773 related to COVID-19. AFCA received 791 COVID-19 complaints about superannuation, the majority of which relate to early access to superannuation.
AFCA chief executive David Locke said Australian consumers have faced a number of significant challenges this year.
“The pandemic has had a particular impact on Australian households, with 20 per cent of COVID-19-related complaints being about financial hardship,” Mr Locke said.
He said AFCA saw less complaints relating to COVID-19 than anticipated due to the proactive response taken by financial firms.
“We commend financial institutions for their quick response to the pandemic. As always, we encourage banks and insurers to maintain open and transparent communication with their customers about the support available to them if they’re experiencing financial difficulty,” Mr Locke said.
“We anticipate seeing more financial difficulty related COVID-19 complaints over the next six months as government support, such as JobKeeper payments, are wound back, along with the end of financial firm initiatives such as a ban on rental evictions and mortgage pausing.”
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.