The Australian Financial Complaints Authority (AFCA) recently adjusted its monetary limits for complaints, including:
- the maximum value of a claim for compensation AFCA can consider;
- the maximum size of a credit facility AFCA can consider a complaint about; and
- the maximum amount AFCA can award a consumer or small business for complaints about banking and finance, general insurance, life insurance and investments and advice.
Superannuation complaints are not affected by the changes, which came into effect on 1 January 2021 and apply to all complaints received from that date.
A claim arising from a credit facility provided to a small business now has a compensation amount limit of $1,085,000 per claim, up from $1 million.
Claims relating to income stream insurance has a compensation limit of $14,500 per claim (up from $13,400), while general insurance has a limit of $271,500 per claim (up from $250,000).
The changes are set out in the AFCA rules, requiring it to adjust its monetary limits on 1 January 2021 and then every three years thereafter.
In accordance with the its rules, AFCA said the previous monetary limits have been adjusted based on the Male Total Average Weekly Earnings for the three-year period up to 30 September 2020 as reported in the most recent Australian Bureau of Statistics report.
AFCA has put on its website a comparison of the monetary limits that apply for complaints received up to 31 December 2020 and the new monetary limits that apply to complaints received from 1 January 2021.