There was a 135 per cent rise in complaints to AFCA about delays in complaints handling by superannuation funds in the financial year 2022–23, according to the AFCA annual report.
Overall, the organisation said there were 6,957 complaints related to super compared to 5,286 in the previous year.
However, the number of complaints that were resolved rose from 33 per cent to 43 per cent. Some 6,142 complaints were closed during the year and the average time taken was 102 days.
The number of complaints related to delays in claim handling rose by 135 per cent, from 737 last year to 1,738 and AFCA said this related to delays in handling insured benefit claims.
“Many superannuation complaints to AFCA can be traced back to issues with service quality, including the clarity and effectiveness of internal dispute resolution processes and the responsiveness of the trustees when questions are raised,” it said.
“While these complaints mainly related to total and permanent disability and income protection claims, AFCA is also receiving increasing numbers of complaints about delays with the finalisation and payment of death benefits.”
This was followed by service quality, account administration errors, incorrect fees and costs and failure to follow instructions.
The top problems based on product were superannuation account, which received 4,369 complaints, up from 3,009 in the previous year. This was followed by complaints about total and permanent disability (985), income protection (949), death benefit (599) and pensions (97).
Earlier this year, Super Review covered how there are issues with super funds’ internal dispute resolution (IDR) processes which is prompting to contact AFCA directly.
While members are encouraged to first contact their super fund in order to resolve a complaint via the internal dispute resolution (IDR) process, AFCA said the number of members contacting them directly is on the rise.
Of all complaints referred back by AFCA to a super fund last financial year, 55 per cent were from consumers who contacted AFCA first rather than their fund’s IDR team. From May 2023, this percentage has increased further to 66 per cent, which AFCA has flagged as a concern.
AFCA told Super Review a lack of engagement with IDR might indicate a “breakdown of trust” with the fund or inadequate identification of a member’s expression of dissatisfaction.
Compared to how funds were allocated to March this year, industry super funds have slightly decreased their allocation to infrastructure in the six months to September – dropping from 11 per cent to 10.6 per cent, according to the latest APRA data.
AMP has made its first foray into bitcoin, confirming a modest allocation to the cryptocurrency, according to its senior portfolio manager.
Fund returns bounced back in November following a subdued October, with SuperRatings reporting 2.4 per cent return for the median balanced option.
Law firm Maurice Blackburn has announced it has reached a settlement with MLC over a class action alleging delays in transferring members to MySuper products.