(Bloomberg) – Australia’s regulators slammed the country’s leaders in pension industry to oversee a culture of poor customer service after reviewing excessive delays in handling death benefit claims.
On Monday, the Australian Securities and Investment Commission detailed the massive failures of industry practice in a report. ASIC has filed lawsuits against the nation’s largest pension and CBU Australians that delay claims for grieving families when dealing with deaths of loved ones.
Death benefits are the amount of savings left by a person when he dies and may also gain benefits from insurance. In one case, a fund spent more than 500 days to pay an indigenous woman about $100,000 ($63,000) of death benefits to an Indigenous woman after her husband’s death.
“The core of this issue is leadership’s lack of grasp of the data, systems and processes of the fund, and ultimately the client’s suffering from the pain,” ASIC Chairman Joe Longo said in a statement. “This disconnection is unacceptable in any area of Australian companies, but in the pension space, it’s particularly serious because super affects everyone from the board to the living room.”
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Australia’s $4.2 trillion pension system is facing increasing scrutiny of concerns about customer service. The ASIC’s review examines the process of 10 largest pension funds, outside of these two funds, it has sued and identified issues including “over delays, poor customer service and invalid claims handling procedures.”
The report proposes 34 improvement recommendations, including faster response times and improved monitoring and reporting.
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