Claims Management and Client Advocacy in Insurance – Part 1

Insurance is designed to provide peace of mind – a safety net for clients when life takes an unexpected turn. However, when the time comes to make a claim, clients often find the process stressful and complex. This is where a financial adviser’s support becomes crucial. In the Australian financial planning context, advisers are not only responsible for helping clients select appropriate insurance cover, but also for guiding them through the claims process and advocating on their behalf. Effective claims management and client advocacy can make the difference between a smooth claims experience and a frustrating ordeal. It can also greatly enhance client trust and loyalty, as clients remember who stood by them during difficult times.

This comprehensive report provides an in-depth look at the insurance claims process from start to finish – from the moment a claimable event occurs to the final resolution. We will examine each stage of the claim lifecycle (notification, assessment, negotiation, settlement, and dispute resolution) and highlight the roles and responsibilities of both insurers and advisers at every step. We will also explore the rights of policyholders and how advisers can ensure those rights are upheld. Importantly, the report compares regulatory frameworks and best practices in Australia with those in other leading markets such as the UK and US, to identify global standards of excellence in claims handling and client advocacy.

Throughout, we emphasize practical strategies for advisers to manage client expectations, gather necessary documentation, and effectively advocate for clients – especially when claims are delayed or disputed. By mastering these aspects of claims management, Australian financial planners can meet high professional and ethical standards (including Continuing Professional Development requirements), strengthen client relationships, and ensure fair outcomes that align with both the client’s best interests and regulatory obligations. This alignment is not only good practice; it has become essential as regulators like the Australian Securities and Investments Commission (ASIC) increasingly focus on fair treatment of insurance customers at claim time.

In summary, supporting clients through insurance claims is an integral part of the value financial advisers provide. The following sections will equip advisers with knowledge of the claims process, case examples, global regulatory insights, and best-practice guidelines to excel in the role of client advocate during what can be one of the most critical periods in a client’s financial life.

Understanding the Insurance Claims Process

Insurance claims handling can be a long and detailed process, involving multiple steps and stakeholders. A clear understanding of the claims lifecycle is the foundation for effective claims management and client advocacy. Below is an overview of the typical stages of an insurance claim, from first notification to final settlement (or dispute resolution, if needed):

1. Claim Notification (Lodgement) – The process begins when the client (or their adviser) notifies the insurer that an insured event has occurred. This could be a phone call, an online form submission, or a written claim form, depending on the insurer’s procedures. Prompt notification is important – many policies require that claims be reported within a certain timeframe. Advisers can assist by ensuring the claim is lodged correctly and without delay. At this stage, the insurer will usually acknowledge receipt of the claim and inform the policyholder of the next steps. In Australia, industry codes and good practice standards encourage insurers to acknowledge and start processing claims quickly. For example, insurers generally should provide any required claim forms or instructions within a few days of being notified. The adviser’s role here is to help the client make the notification in the proper manner, provide all preliminary information required, and make sure the client understands what information or documentation will be needed.
2. Documentation and Information Gathering – Once notified, the insurer will ask for documentation to assess the claim. This may include claim forms, medical reports, police reports (for events like accidents or theft), proof of ownership or loss (for property claims), death certificates (for life insurance claims), and other evidence relevant to the claim. The assessment phase often involves fact-finding and investigation: the insurer reviews the policy terms and the circumstances of the claim to determine coverage. They might consult external experts, such as loss adjusters, medical specialists, or investigators, especially for complex claims. Throughout this phase, communication is key. Insurers should inform the claimant what documents are needed and keep them updated on the progress. From an adviser’s perspective, this stage is where proactive support is invaluable. The adviser can help the client gather and submit all necessary documents, ensuring nothing critical is missing that could delay the claim. Advisers can also explain to the client why certain documents are needed and how policy terms (like definitions of disability or proof of loss requirements) apply to their case. By acting as an organized liaison between the client and insurer, the adviser helps prevent miscommunication and keeps the process moving.
3. Claim Assessment and Review – With all information in hand, the insurer’s claims team evaluates the claim against the policy coverage. They verify facts, check that premiums were paid and the policy was in force at the time, and apply any relevant policy conditions, exclusions, or waiting periods. During this stage, questions may arise: for example, the insurer might seek clarification on a medical history detail or request an independent medical examination for a disability claim. They may also review whether the client fulfilled their duty of disclosure at policy inception (though in Australia for life insurance, the test now is a duty to take reasonable care not to make a misrepresentation, which has replaced the old duty of disclosure for consumer policies). Insurer responsibilities during assessment include acting in good faith, conducting the investigation promptly and fairly, and not unnecessarily delaying their decision. Insurers also should not misrepresent policy provisions or look for technicalities to deny a valid claim. From the client’s viewpoint, this waiting period can be stressful. Here, advisers should manage expectations and maintain regular contact. If the insurer needs additional information or there are delays (perhaps awaiting a specialist report), the adviser can chase up progress and keep the client informed. Advisers can also interpret interim responses from insurers for the client – for instance, if an insurer invokes an exclusion clause, the adviser can review whether that is justified and start formulating a response or gathering counter-evidence if needed.
4. Decision, Outcome, and Settlement – After assessment, the insurer makes a decision on the claim. There are generally three possible outcomes:
• Approval: The claim is accepted either in full or in part. The insurer will communicate the acceptance and arrange settlement. Settlement can mean payment of a lump sum (for example, a death benefit or a trauma insurance payout), periodic payments (such as monthly income protection benefits), or repairs/replacements (in general insurance, e.g. repairing a car or home). Insurers should pay out promptly once a claim is approved. Best practice globally is that once terms are agreed, the claim is settled without undue delay. Advisers can add value here by ensuring the client receives the payment in the correct account or that repairs are scheduled, etc., and by advising on how to manage or invest any large lump sum received (although that may be beyond the immediate scope of claims handling, it is part of holistic financial planning).
• Denial: The claim is denied (wholly or partially). If an insurer rejects a claim, they are expected to provide a clear explanation or reason for the decision, usually in writing. Common reasons for denial might include the event not being covered by the policy (e.g. a specific exclusion applies), material non-disclosure or misrepresentation by the client at application time (leading the insurer to void or cancel the policy), lapsed policy due to non-payment of premium, or the claim not meeting a policy definition (for instance, a condition not severe enough to meet a Total and Permanent Disability definition). When a denial happens, it is a critical moment for adviser advocacy. The adviser should review the denial reasons with a fine eye: do they align with the policy wording? Is the decision fair and based on all available evidence? If something seems amiss, the adviser can challenge the decision or seek clarification. We will discuss dispute resolution steps in the next stage. Even if the denial is technically correct, the adviser should help the client understand the outcome and explore if any other support or options exist (for example, if a trauma claim is denied but the client might qualify for a partial benefit, or if another policy could be claimed on).
• Negotiated/Alternate Settlement: In some cases, especially in commercial or complex personal lines claims, there might be a negotiation. For instance, the insurer might offer a partial payment as an ex-gratia (goodwill) gesture if some doubt exists about coverage, or there may be a debate about the quantum (amount) of a loss. In general insurance (like property claims), an insurer might dispute the claimed amount and negotiate a lower figure or specific repair approach. In life insurance, there’s less “negotiation” on amount since sums insured are fixed, but there could be negotiation on things like whether a benefit should be paid now or if the insurer suggests a rehabilitation program with an option to claim later, etc. Advisers play a role here by advocating for the best possible outcome for the client. That means ensuring the client doesn’t accept an unfairly low settlement or unreasonable terms. Thanks to their knowledge of industry norms and policy wording, advisers can push back against low offers or suggest alternative resolutions.
5. Dispute Resolution (Internal and External) – If the outcome is unsatisfactory (commonly, if a claim is denied or not fully paid and the client disagrees), the focus shifts to resolving the dispute. Most jurisdictions, including Australia, require insurers to have an Internal Dispute Resolution (IDR) process. This means the client (or their representative/adviser) can lodge a complaint with the insurer’s complaints department or dedicated IDR team. In Australia, ASIC’s Regulatory Guide 271 sets strict standards for how financial firms (including insurers) must handle complaints. For example, the insurer must acknowledge the complaint quickly and provide a final response within a set timeframe (for insurance claims disputes, usually within 30 days, unless there are exceptional circumstances). During IDR, the insurer’s team should conduct a fresh review of the case – sometimes this results in overturning the original decision if an error or new evidence is presented. An adviser can greatly assist here: writing a clear, factual complaint letter outlining why the client believes the claim should be paid, referencing the policy terms and any supporting evidence. The tone should remain professional and focused on facts, policy obligations, and any laws or codes that support the client’s position (for example, pointing out the insurer’s duty of utmost good faith, which implies they should not unreasonably reject claims). If the internal review still results in a denial or an unsatisfactory offer, the client in Australia has the right to take the complaint to the Australian Financial Complaints Authority (AFCA), an external dispute resolution scheme. AFCA is an independent ombudsman service that can adjudicate insurance disputes (among others) for consumers and small businesses, free of charge to the complainant. AFCA can make binding decisions on insurers (up to certain monetary limits) including ordering a claim to be paid or compensation for delays. In the UK, a similar role is played by the Financial Ombudsman Service (FOS), and many other countries have equivalent ombudsman schemes or consumer dispute tribunals. Advisers should inform clients about these rights and help them navigate the process of lodging an external complaint if needed. In many cases, the mere escalation to AFCA or an ombudsman prompts insurers to reassess and sometimes settle the claim to avoid a formal dispute ruling. If all else fails, the final avenue is litigation – suing the insurer for breach of contract or bad faith. This is rare and usually a last resort due to cost and time, but advisers should know reputable insurance lawyers to refer the client to if it reaches that stage. However, a well-managed claim seldom needs to go to court – with adviser advocacy, most valid claims can be resolved through the earlier stages of review or external dispute resolution.

It’s worth noting that the above process can vary slightly depending on the type of insurance. For instance, life insurance claims (like death, Total and Permanent Disability, or trauma/critical illness claims) often involve detailed medical evidence and can take longer to assess than a straightforward general insurance claim (like a car accident repair). Income protection claims may involve ongoing assessment (regular medical reviews, proof of continuing disability, etc., for monthly benefit payments). General insurance claims (home, motor, etc.) might involve assessing damage and repair quotes. Yet, despite differences, the core principles of fairness, timeliness, communication, and proper documentation apply universally.

From the client’s perspective, and certainly from a financial planner’s perspective in Australia, the goal is to ensure the claim journey is as smooth as possible, and that the client receives everything they are entitled to under the policy. By understanding each phase of this lifecycle, advisers can anticipate what needs to be done and proactively assist their clients, reducing confusion and anxiety. In the following sections, we will delve deeper into how advisers can add value at each stage, how they manage client expectations, and the specific advocacy strategies they can employ when challenges arise.

The Adviser’s Role in Supporting Clients Through Claims

Financial advisers in Australia are expected to act in their clients’ best interests – a legal and ethical obligation that extends beyond just recommending an insurance product. It includes supporting the client after the product is in place, especially at claim time when the client most needs help. A true test of an insurance policy’s value (and an adviser’s service) is how a claim is handled. Below, we outline the key roles a financial adviser plays in claims management and client advocacy, with practical strategies for each aspect:

Setting Expectations and Education (Pre-Claim Preparation)

The foundation for a positive claims experience is actually laid before any claim ever occurs. Advisers should educate clients at the time of policy recommendation and purchase about the policy’s features, benefits, and limitations. Clear understanding prevents many misunderstandings at claim time. Key points an adviser should cover with clients include:

• What events are covered and what are not: For example, if a life insurance policy has exclusions (such as suicide in the first 13 months, or war exclusions) or if an income protection policy has specific definitions of disability, the client should know these upfront. Similarly, explain any waiting periods (e.g. a 30-day waiting period on income protection means the first month of disability won’t be paid) so that clients aren’t caught off guard.
• The importance of full disclosure: Advisers must impress on clients the necessity of answering all medical and personal history questions honestly and thoroughly during application. In Australia, life insurance contracts are subject to the duty to take reasonable care not to make a misrepresentation to the insurer. Non-disclosure or misrepresentation can lead to claims being denied or policies being cancelled. Advisers can help by carefully guiding clients through application forms, clarifying questions, and documenting the disclosure. This reduces the risk of issues later. (Notably, advised policies in Australia go through robust underwriting at application time, which leads to far fewer claim disputes later compared to policies bought directly without advice. Statistics have shown that adviser-assisted policies have higher claim approval rates – for example, according to data from the Australian Prudential Regulation Authority (APRA), in recent years over 95% of death and disability claims on advised life insurance policies are paid, a few percentage points higher than for non-advised policies. This reflects better matching of cover and more accurate disclosure when advisers are involved.)
• How to make a claim and what to expect: Even at policy inception, advisers can give a brief overview: “If you ever need to claim, contact me or the insurer directly as soon as possible. The insurer will require some forms and evidence – for a health-related claim, they’ll need medical reports, etc. They typically take some time to assess, depending on the complexity. But I will be there to guide you through it.” This conversation plants the seed that the adviser will act as a helper and advocate, and it also sets realistic expectations that claims involve procedures and are not instantaneous. Clients who have a realistic expectation (for example, understanding that a TPD claim might take several months of medical evaluations) are less likely to become frustrated or distrustful during the process.

Ongoing education is also important. Insurance policies can be long-term (decades for life insurance). Advisers should periodically remind clients of what coverage they have and encourage them to update any personal details that could affect claims (like new contact information or changes in health that might need updating for certain policy features). Annual reviews are a good time to re-confirm the client’s understanding of their policies. Managing expectations upfront in an honest way builds credibility; clients will appreciate an adviser who doesn’t “oversell” the policy but instead paints a true picture of how it works. For example, saying “This income protection policy will provide you 75% of your income if you’re injured or ill and unable to work, after your 30-day waiting period, and it will continue paying until you recover or up to age 65. However, remember that you’ll need medical proof of your disability, and the insurer will regularly review your condition – it’s not automatic. I will help you with that if you ever need to claim.” Such an explanation balances the positive promise of the product with the practical reality of the claims process.

By setting the stage with education and honesty, advisers can prevent a lot of confusion and disappointment at claim time. Clients will know, for instance, that if they had a pre-existing condition not covered, a claim might not succeed – rather than only discovering that fact in a moment of crisis. Ultimately, realistic expectations are neither an undersell nor an oversell; they are about giving the client clear knowledge of what they’ve bought and the process that comes with it. This upfront work underpins all later advocacy: a client who understands their policy will be a strong partner with the adviser in pursuing the claim, rather than feeling misled.

Assisting with Claim Lodgement and Documentation

When a claim event occurs, clients may be in shock, grief, or pain – think of a family dealing with a death, or an individual facing a serious injury. In such moments, handling paperwork is daunting. One of the most appreciated roles of an adviser is to take on the administrative burden of lodging the claim and gathering documentation. Here’s how advisers can help at this stage:

• Initiating the Claim: Advisers can either lodge the claim on the client’s behalf (with the client’s permission) or guide them through notifying the insurer. Many insurers in Australia have dedicated adviser support lines or online portals where an adviser can submit a claim notification. By doing so, the adviser ensures the claim is registered correctly and promptly. This also allows the adviser to immediately get a contact point at the insurer (like a claims consultant assigned to the case) for follow-ups.
• Explaining Requirements: Once the claim is lodged, the insurer will specify what documents or forms are needed. An adviser should go through this list with the client in plain language. For example, “We need a certified copy of the death certificate, which usually takes a couple of weeks to obtain – I can help you request additional copies. We also need the treating doctor to fill out this medical report form – I’ll liaise with the clinic to facilitate that. And we’ll submit a claim form which asks for details of the event; I can help you complete that form to make sure everything is answered properly.” Breaking down the requirements helps the client see a roadmap of what will happen next.
• Gathering Supporting Documentation: Advisers often act like project managers at this stage – tracking what documents have been obtained and what is outstanding. They can help by:
• Contacting doctors for medical reports or records (with client authorization). Sometimes doctors respond more promptly to a professional request, and the adviser can ensure the doctor understands what information the insurer needs to see.
• Assisting the client in obtaining necessary certificates or reports (like death certificates, police reports if it was an accident or theft, pathology results in a trauma claim, employer statements for income claims, etc.). Advisers might know, for instance, to ask the employer for an official salary certificate or leave records for an income protection claim.
• Ensuring documents are certified if needed (many insurers require important documents like certificates or IDs to be certified true copies). Advisers often are JPs (Justices of the Peace) or know one, and can help get things certified correctly.
• Compiling everything into a complete submission. This thorough approach can prevent the common scenario where an insurer comes back repeatedly asking for additional information bit by bit. It is frustrating for clients when a claim drags on due to piecemeal requests. A good adviser tries to anticipate what will be needed and submit a complete claim package up front. For example, for a TPD claim, apart from the main forms, they might proactively include copies of all relevant specialist reports, any medical imaging results, and a letter from the client’s employer about inability to work – covering all bases so the insurer has fewer reasons to delay.
• Accuracy and Clarity: Advisers should double-check all forms for accuracy. Simple errors (like a misspelled name, or wrong policy number, or incomplete bank details for payment) can cause unnecessary delays. They should also ensure that the description of the claim event is clear and factual. This narrative part is important; the way a claim is described can influence how it’s assessed. An adviser can help the client articulate the situation fully. For instance, rather than a client hastily writing “I hurt my back, can’t work,” an adviser can help craft a more complete statement: “On 12 March 2025, the client slipped from a ladder while at home, resulting in a severe back injury. He was diagnosed with a lumbar spine fracture and nerve damage, confirmed by MRI (report attached). As a result, he has been unable to perform his job as a construction supervisor from that date. Treating specialist Dr. Smith has recommended surgery and estimates a recovery period of 6-12 months (medical report attached).” Such detail, provided early, gives the insurer a clearer picture and often leads to a smoother assessment.

Overall, during the lodgement and documentation phase, the adviser’s objective is to make it easy for the insurer to say yes. By providing a well-organized claim submission with all necessary information, the adviser reduces back-and-forth queries. This not only speeds up the claim but also positions the claim in the best light. It is part of effective advocacy – you are advocating the client’s case through the documentation you provide. Think of it like preparing a dossier: the stronger and clearer it is, the more likely the claim officer will have confidence in approving the claim.

For the client, having the adviser handle this legwork relieves stress. Clients often express immense relief and gratitude that they didn’t have to chase paperwork or argue with doctors for reports. It allows them to focus on personal matters (recovery, family, grieving, etc.) while trusting that their financial protection is being dealt with professionally. This level of support significantly deepens the client-adviser relationship and demonstrates the real-life value of the insurance and the advice they received.

Liaising with Insurers and Keeping Clients Informed

Insurance claims can involve weeks or months of processing, especially for complex cases. During this time, a client can feel anxious if they’re left in the dark. A key advocacy role of the adviser is to act as a communication bridge between the insurer and the client, making sure information flows smoothly and promptly in both directions.

Responsibilities of the adviser in this liaison role include:

• Regular follow-ups with the insurer: Insurers handle thousands of claims, and while they aim to process each efficiently, backlogs and delays can occur. An attentive adviser will diarize regular check-ins (for example, a quick call or email every week or two) to ask about the status of the claim. This persistent yet polite follow-up keeps the claim on the radar of the claims officer. If there’s been any holdup (say, waiting on an external medical opinion), the adviser can learn of it and possibly help expedite (maybe by contacting the doctor to politely remind them to send the report). Many advisers have noted that their involvement often results in faster responses – possibly because the insurer knows an adviser understands the process and won’t hesitate to escalate if timelines slip excessively.
• Providing additional information quickly: If the insurer requests further information or clarification, the adviser should help obtain it as quickly as possible. For instance, the insurer might ask a follow-up question like “Can we get clarification on the client’s exact duties at work, to assess the disability claim against the ‘unable to perform own occupation’ definition?” The adviser can answer this by working with the client (and possibly their employer) to provide a detailed job description or letter. By turning around requests swiftly, advisers prevent small questions from turning into big delays. They should also keep a record of all communications in writing when possible (email trails) for accountability.
• Translating insurer communications for the client: Insurance letters and emails can sometimes be laden with jargon or unclear phrasing. An adviser adds value by interpreting these for the client. For example, if a client receives a letter saying “Your claim is deferred pending receipt of Attending Physician’s Statement and subject to policy exclusion clause 5.1,” the client might be bewildered. The adviser can explain: “This means the insurer is waiting for the doctor’s report we’ve requested – the Attending Physician’s Statement – and they’re flagging that they will check it against exclusion 5.1, which is the exclusion for pre-existing conditions. Don’t worry, based on what we know, that exclusion shouldn’t apply because you’ve never had this condition before. We’ll follow up to make sure they get the doctor’s report and review it promptly.” This kind of clarification reassures the client and keeps them informed without causing unnecessary alarm.
• Managing client expectations throughout: Even after initial education, expectations need to be managed during the claim. If an insurer told us “We expect to have a decision in four weeks,” the adviser should convey that to the client along with a caveat that sometimes it can take longer if, say, the insurer is waiting on a third party. It’s wise to under-promise and over-deliver: for instance, advise the client that “it might be around 4-6 weeks to hear back, but I will keep you posted along the way.” Then, if it gets done in 4, you celebrate the quick resolution; if it takes 6, the client was mentally prepared. Always avoid guaranteeing a specific outcome by a specific date when it’s not fully under your control – instead, pledge that you will do everything in your power to keep it moving.
• Being the client’s voice: Sometimes clients feel uncomfortable directly questioning an insurer or don’t know what they are allowed to ask. Advisers, as experienced professionals, should feel empowered to ask the insurer reasonable questions on behalf of the client. For example, if a claim is taking unusually long, the adviser can respectfully ask the claims manager, “Could you help me understand what’s causing the delay? Is there any information outstanding or any way we can assist to move things along?” Or if a claim is denied, the adviser can ask, “Could you clarify which policy clause was relied on for the denial? We want to review that in detail to understand the decision.” These questions not only gather information but also signal to the insurer that the claimant has knowledgeable representation, which often leads to more careful handling.
• Advocating empathy and fairness: While communicating with the insurer, the adviser can also humanize the client’s situation. Insurers are organizations but they are run by people; sometimes a claims assessor who hears directly (through the adviser or in a letter) about the hardship a client is facing will respond with more urgency or flexibility. For instance, an adviser might communicate, “My client is under significant financial stress due to being unable to work since the accident – they are struggling to meet mortgage payments. Is there any possibility of an interim payment or an expedited assessment given the circumstances?” The 2020 General Insurance Code of Practice in Australia, for example, includes provisions for fast-tracking claims for clients in urgent financial need. Life insurers too often have clauses to advance part of a benefit if needed urgently (e.g., funeral expense advances). An adviser aware of these can request them. This is part of advocacy: not just processing paperwork but actively looking out for the client’s welfare during the claim.

Throughout this liaison role, documentation is key for compliance and clarity. Advisers should keep notes of phone calls (date, whom they spoke to, what was said) and copies of all correspondence. This protects the client and adviser in case there is any dispute about what was communicated. It’s also useful if the claim needs escalation – being able to show the timeline of contacts and responses can support a case that the insurer has delayed or not communicated adequately (if that becomes an issue).

In sum, the adviser essentially project-manages the claim, champions the client’s interests, and keeps the client in the loop. This ongoing communication role is where many clients truly feel the difference of having an adviser. Instead of sitting alone by the phone, wondering what’s happening, they have a professional ally giving them regular updates and pushing the process forward. It greatly reduces the emotional burden on the client, which is just as important as the financial outcome.

Advocacy and Negotiation on Behalf of the Client

Advocacy is at the heart of an adviser’s role during an insurance claim – especially when the claim outcome is not straightforward. This can range from mild advocacy (clarifying a point so the insurer can make the right decision) to strong advocacy (formally disputing a denial). A related skill is negotiation, which can come into play if there’s an offer on the table that might be improved or if there’s some flexibility in how a claim is settled. Let’s break down how advisers can advocate effectively:

• Reviewing the Insurer’s Decision Critically: When an insurer makes a decision (approval, denial, or partial payment), an adviser should carefully review the correspondence and the policy wording. If it’s an approval, check if the payment amount is correct (e.g., correct sum insured plus any interest if payment was delayed, or any indexation increases included). If it’s a denial or conditional approval, identify the exact reason. Insurers will cite policy clauses or exclusions. The adviser should pull out the client’s policy document and read those clauses in full context. Does the claim indeed fall under that exclusion or condition? Sometimes insurers make mistakes or stretch an interpretation. For example, an insurer might deny a trauma claim saying the condition doesn’t meet the definition. The adviser can gather medical evidence or expert opinion to see if that is arguable – maybe the client’s condition is borderline and a specialist letter could support that it does meet the criteria. A classic example: a trauma insurance might pay for “heart attack of a specified severity.” There have been cases where insurers denied claims because certain enzyme levels in the blood were not high enough, as per an outdated definition, even though the client had a serious heart attack. An adviser aware of medical advancements and fairness might challenge this by obtaining a cardiologist’s opinion that the heart attack was indeed severe even if one marker was slightly below the threshold.
• Leveraging Policyholder Rights and Insurer Obligations: Advisers should invoke the principles that hold insurers accountable. In Australia, two powerful overarching obligations are the duty of utmost good faith (from the Insurance Contracts Act) and the requirement for AFS licensees to act “efficiently, honestly, and fairly.” If an adviser believes an insurer is not treating the client fairly, they can reference these obligations in their communications. For example, a letter to an insurer’s internal dispute team might say, “We believe the decision to deny the claim is not consistent with the duty of utmost good faith. The client provided all requested information and the evidence strongly supports the claim under the policy terms. We request a re-evaluation of the claim in light of this, or a detailed explanation of how the decision aligns with your obligations under the Insurance Contracts Act and ASIC’s fairness requirements.” Using such language signals that the adviser (and by extension the client) is knowledgeable about their rights. Insurers know that a failure in these duties can lead to regulatory action or be grounds for AFCA to rule against them. Indeed, in recent years ASIC has taken insurers to court for unfairly handling claims, and courts have imposed penalties for breaches of good faith.
• Internal Escalation: Often, an adviser’s first advocacy step on a contentious claim is to escalate within the insurer’s ranks. If dealing with a front-line claims officer isn’t yielding progress, the adviser can ask that the matter be reviewed by a team leader or the insurer’s internal dispute resolution department even before formally lodging a complaint. Many insurers have claims advocacy or case managers who might step in for complex cases, especially when an adviser or lawyer is involved. Additionally, insurers in Australia subscribe to codes of practice that have complaints obligations – for instance, under the General Insurance Code or Life Insurance Code, they must have a process to escalate unresolved claim issues. Advisers can cite code provisions (like timeframes: e.g., the Life Insurance Code might specify that an insurer should make a decision on a claim within a certain number of days or provide reasoning if more time is needed) to push the insurer to act.
• Negotiating Solutions: Not all claim disputes are black-and-white. Sometimes an insurer might have a valid concern but also some willingness to find a middle ground. An adviser can negotiate for the client in such scenarios. For example:
• If a claim technically falls outside cover but the circumstances evoke sympathy (like a claim denied for being slightly outside a policy period or due to a grey area in definitions), an adviser can ask if the insurer would consider an ex-gratia payment or a goodwill gesture. Insurers sometimes do this to maintain good customer relationships or if they feel the customer may have been hard done by in some way (especially if there was any ambiguity in how the policy was explained).
• In a total and permanent disability (TPD) claim, if the insurer believes the claimant might recover or benefit from rehabilitation, they might resist paying a lump sum immediately. An adviser could negotiate a structured approach: for instance, “If the client undergoes an approved rehabilitation program, and after 12 months is still unable to work, the insurer will then pay the TPD benefit.” While the client ideally wants the payout now, this kind of negotiation might be a way to eventually secure a benefit rather than an outright denial. The adviser ensures the client’s interests are protected in the agreement (perhaps securing interim financial support during those 12 months from another benefit or partial payment).
• In income protection claims, there may be disputes over the monthly amount (perhaps due to variable income or post-claim earnings). An adviser can help by providing additional financial evidence (tax returns, pay slips) and negotiating the calculation with the insurer’s claims accountant to ensure the client gets the maximum they’re entitled to.
• If a claim is stuck on a technical point, sometimes proposing an independent mediator or expert assessment can move things along. For example, if there’s conflicting medical opinions, an adviser might suggest that both parties agree on a third independent specialist to review the case, with the insurer agreeing to abide by that opinion. This is essentially negotiating a way to break a deadlock.
• Preparing for External Review (AFCA or Ombudsman): If the insurer isn’t budging internally, an adviser should help the client prepare a strong case for AFCA (or the relevant external forum). This involves compiling all correspondence, the policy wording, timelines of events, medical or other expert evidence, and a clear narrative of why the claim should be paid under the policy. While AFCA’s process is designed to be consumer-friendly (clients can lodge complaints without legal representation), having an adviser’s assistance can greatly improve the clarity and focus of the complaint. The adviser might draft the complaint letter or online submission, ensuring it addresses the key issues that AFCA will consider (such as whether the insurer’s decision was fair and in line with the contract and obligations). The adviser can also cite any precedents or similar cases if known (AFCA publishes anonymized determinations which can sometimes be referenced if a similar scenario occurred). Throughout the AFCA process, the adviser can continue to advocate – for instance, helping the client respond to any insurer defenses, and participating in any informal negotiations or conciliation that AFCA facilitates. It’s not uncommon for insurers, once a case is at AFCA, to suddenly offer a settlement (sometimes paying the claim or reaching a compromise) to avoid a formal ruling. Advisers can help the client evaluate any such settlement offers objectively – whether it’s fair or if they should hold out for a full determination.
• Knowing When to Involve Other Advocates: In some cases, advisers might decide that additional help is needed – for example, if a claim involves complex legal interpretations or very large sums, engaging an insurance law specialist or a barrister to provide an opinion can add weight. Similarly, if a client’s health condition is unusual, seeking a specialist medical opinion letter (beyond the treating doctor) might help persuade the insurer or an ombudsman. While these steps can incur costs, an adviser can help the client weigh the cost-benefit (and sometimes insurers will reimburse some costs if it leads to a claim being paid, or such costs can be recovered as part of a claim in court or AFCA in certain cases). The key is, the adviser coordinates these resources in the client’s interest.

Advocacy can sometimes bring an adversarial feel to dealings with an insurer, but a skilled adviser maintains professionalism and a solutions-focused attitude. It’s about assertively representing the client’s rights without unnecessary antagonism. Remember, insurers are bound by regulations to treat customers fairly and have their reputation to consider; a well-founded challenge by an adviser often triggers a more senior review within the insurer, because they know the next step could be external escalation or reputational damage.

One remarkable benefit of adviser advocacy is how it contributes to client trust and retention. Clients see tangible evidence that their adviser is willing to fight for them. This builds loyalty that far outlasts the claim. It can also generate referrals – clients often tell friends and family how their adviser helped get an insurance claim paid when others might have given up. From a business perspective, this is invaluable word-of-mouth advertising for an adviser’s practice.

Emotional Support and Empathy

While much of claims management involves technical and administrative tasks, advisers should never lose sight of the human element. Clients going through insurance claims are often experiencing significant life events – the very events they hoped would never happen. Death, illness, injury, loss of property, disability – these can be traumatic. An adviser’s role is not only that of a technical expert but also a steady supporter who provides reassurance and compassion.

Ways advisers can support clients emotionally include:

• Showing empathy and patience: Simply acknowledging the client’s situation and feelings goes a long way. For example, in a meeting or call about the claim, an adviser might say, “I understand this is a really difficult time for you and your family. We’re going to work through this claim together. I’m here to take as much of this off your plate as possible so you can focus on your family/recovery.” This kind of genuine concern can be a huge relief to a client who may have been feeling overwhelmed.
• Being available and responsive: Clients may have moments of anxiety where they need to ask a question or get an update for peace of mind. Advisers should encourage clients to reach out if they’re unsure of anything. By being responsive to these queries, even if just to say “I followed up today and no news yet, but I will keep on it,” the adviser assures the client that they haven’t been forgotten. Silence can be very scary for someone awaiting a claim outcome – it might lead them to fear the worst. Regular check-ins (“I just wanted to see how you’re holding up – any questions or anything you need?”) can be very comforting.
• Respecting the client’s emotional state: Some clients will want to be very involved in every detail of the claim; others will emotionally shut down and avoid thinking about it. Advisers should gauge this and adjust their communication accordingly. For instance, a widow grieving her spouse might not be up to handling any paperwork – the adviser might gently say, “Would you prefer that I just handle all correspondence with the insurer and only update you when necessary? I can also include someone else from your family in communications if you like.” On the other hand, a detail-oriented client may find comfort in reviewing documents and being copied on communications; obliging that need for control can ease their anxiety.
• Utilizing additional support services: Some insurance policies or companies offer extra support like grief counseling, wellness programs, or rehab services as part of their claims process. A number of life insurers in Australia, for example, now provide access to support programs – such as counseling for beneficiaries, career coaching if someone has to change jobs after disability, or nurse helpline services. An adviser should be aware of these and help connect the client to them. Even if not provided by the insurer, the adviser might suggest outside support: “Have you considered speaking to a financial counselor or psychologist? I can help find someone – sometimes talking about the stress can help while we wait for the claim outcome.” This shows the client you care about them as a person, not just as a claim to be processed.
• Maintaining professionalism and calm: Clients often take cues from their adviser’s demeanor. If the adviser stays calm, optimistic (but realistic), and organized, the client will feel more secure. Even if there are frustrations (like a delay or a perceived unfair request from the insurer), the adviser should manage those behind the scenes as much as possible and present a composed front to the client: “Yes, the insurer has asked for another document. I know it’s frustrating, but this sometimes happens. The good news is it means they’re actively working on your claim. I’ll help get this sorted quickly so it shouldn’t set us back too far.” By absorbing some of the stress and not amplifying it, advisers do a great service to their clients’ mental well-being.
• Celebrating positive outcomes: If and when the claim gets approved and paid, an adviser should share in the relief and acknowledge what this means for the client. “I’m so glad we got this outcome – it means your family will be financially secure, which is one less thing to worry about as you heal.” Recognizing the importance of the moment reinforces the value of what the client has been paying premiums for, and the value of the adviser’s work. It turns a difficult journey into a reaffirmation of the planning that was done.

In essence, client advocacy is not just about fighting for dollars; it’s about standing beside the client throughout the journey. Advisers often become a kind of coach and confidant in the process. By blending empathy with expertise, they help clients not only get the claim paid but also get through the experience with their dignity and sanity intact. This holistic support is a hallmark of truly professional financial advice.

Having explored the adviser’s role from multiple angles, we can see it spans educator, administrator, communicator, negotiator, and emotional supporter. Next, we will look outward to the broader frameworks that govern claims – the responsibilities insurers have and the rights policyholders possess – and compare how different jurisdictions ensure fair play in the claims arena. This will further inform how advisers can effectively operate within these frameworks to serve their clients.