A former insurance insider who spent a decade working behind the scenes has named the companies he says he would not trust with his own money, warning Australian customers could face financial strain and frustration when disaster strikes.
Luke Dugdell worked for 10 years in risk and compliance departments at major banks and insurers, a role he likened to being the industry’s “internal police”.
However, as his career progressed, Dugdell said he became disenchanted by the way ordinary Australians seeking insurance payouts were treated.
After witnessing what he described as consumers “being taken advantage of”, he eventually left the corporate insurance world to advocate for people facing difficulties with their claims.
He is now the founder and managing director of Claims Hero, which supports Australians dealing with delayed, reduced or rejected insurance claims.
Appearing on the Karl Stefanovic Show, the former industry worker openly discussed the insurers and brands he would personally avoid.
His main concerns centred on brands owned by insurance group Auto & General, including Budget Direct, Qantas Insurance and Coles Insurance.
“The ones that would be on my list, I think Auto & General, so Budget Direct, Qantas Insurance, Coles Insurance, those are the brands,” Dugdell told Stefanovic.
Luke Dugdell spent a decade in risk and compliance roles at major banks and insurance companies
“They’re just not an insurer that I personally would want to be with if I found myself in that situation.”
Dugdell also raised concerns about what he said was the withholding of important documents and information from policyholders, potentially leaving homeowners unaware of serious issues affecting their properties.
“The conduct that we see on some of the claims that we manage is that, you know, they have reports and information, and they just refuse to provide it to a consumer,” he said.
He referred to an ongoing matter involving a homeowner who allegedly spent two years unaware of a document detailing restoration work that could have been required to deal with mould at the property.
“We only identified it two years later that they actually had that quote and scope, which is telling them likely that there was mould in the property and they needed to deal with it,” Dugdell said.
According to Dugdell, the insurer declined to release the document despite multiple requests, including those made under the General Insurance Code of Practice and the Privacy Act.
“We’ll request it under the code. We’ll request it under the Privacy Act, and they’ll say no, we’re not giving you that,” he said.
“And even as you go up the ranks, they just maintain that decision that there’s no good reason to give that information to a consumer.”
After years of seeing consumers “being taken advantage of”, Dugdell left the industry to support people struggling with insurance claims
He described the alleged practice as unacceptable, arguing that insurers hold a significant advantage over customers who may be relying on a claim to repair their home or recover financially.
“Withholding information from a consumer is just unconscionable because the power imbalances is massive. That should be against the law,” he said.
He called for tougher laws forcing insurance companies to hand over relevant documents, arguing that the current General Insurance Code of Practice allowed insurers to exploit a loophole.
‘It needs to be legislated that you have to disclose the information that you have to a consumer, not the current code that says “if we relied upon it”,’ he said.
‘It just gives them [insurance companies] an out. They go, “we didn’t rely upon it, so we’re not giving that information”. So, to me, it’s conduct like that that’s really poor.’
But withholding documents was not the only tactic Dugdell took aim at.
He also raised concerns about vaguely worded ‘good condition’ clauses buried in insurance policies, claiming they could be used to avoid paying for repairs.
According to Dugdell, some insurers use the clauses to argue that a property has not been properly maintained, leaving homeowners facing a potentially enormous repair bill before their insurance claim can be resolved.
Dugdell also named QBE as an insurer on his ‘hit list’, particularly for its use of ‘loss adjusters’
Dugdell made the claims about the insurers on the Karl Stefanovic podcast
In some cases, he claimed, customers were being handed lists of maintenance work costing tens of thousands of dollars, even when the repairs were unnecessary or unrelated to their original claim.
‘The good condition terminology is so broad it just gives them basically the ability to not repair homes if they don’t want to,’ he said.
‘Often the list that we have from consumers, and we just see these letters being sent every single time, could be tens of thousands of dollars on maintenance items that probably aren’t required or don’t need to be done.’
Dugdell also took aim at insurance giant QBE, placing it on his ‘hit list’ over what he claimed was its reliance on ‘loss adjusters’ to keep claim costs down.
Loss adjusters are responsible for investigating insurance claims, inspecting property damage and reviewing repair quotes before advising insurers on how much they should pay.
But Dugdell claimed the process could leave homeowners thousands of dollars out of pocket, alleging that some loss adjusters pressured builders to reduce their quotes.
‘We just see with insurers that rely heavily on loss adjusters that you know they’re sort of trying to reduce those costs,’ he said.
‘I’ve seen it in reports where they’ll go, a loss adjuster will take $7,000 out of a quote for a builder, or just go, “Could you remove that $7,000?” And then they’ll write to the insurer and say, “I saved you $7,000”.
At the top of his list were brands operated by insurance giant Auto & General, including Budget Direct, Qantas Insurance and Coles Insurance.
‘I’m like, “No, you didn’t. You just ripped off that consumer $7,000 because they should have been paid that”.’
But his criticism of QBE did not stop there.
Dugdell also raised concerns about how the insurer investigated suspected fraud, claiming some companies subjected policyholders to intrusive questioning and demands for personal information.
‘You’ll have QBE where, honestly, some of these insurers think… their policy terms gives them rights more than the police,’ he said.
He claimed that when an insurer suspected fraud, customers could be forced to undergo filmed interviews and hand over sensitive financial and phone records or risk having their claims rejected.
‘If they have what they think is a suspicion of fraud or an inkling, they’ll make you go to a recorded interview that’s filmed,’ he said.
‘You can have a support person that can’t say anything. You got to give your bank records, your phone records, and if you say no to any of it, they’re just going to decline your claim.
‘It just angers me so much because it often causes delay and extreme stress, and it would just be over something simple.’
Dugdell warned Australians against choosing insurance policies based solely on price, arguing that a cheaper premium could come with costly consequences when it was time to make a claim.
He urged homeowners to read the fine print carefully, challenge decisions they believed were unfair and demand explanations about the information insurers used to assess their claims.
He also called for tougher laws to force greater transparency and accountability across the insurance industry, arguing that consumers deserved better protection when dealing with companies responsible for covering their losses.
A spokesperson for QBE told The Daily Mail that Dugdell’s claims did not accurately reflect how the insurer handled policyholders’ claims.
‘QBE is committed to treating customers fairly and respectfully, and ensuring claims are assessed on their individual circumstances and in line with the terms of the relevant policy,’ QBE said.
Auto & General took aim at Claims Hero, describing the company as one of the industry’s ‘for-profit disaster chasers’.
Claims Hero can take a cut of customers’ insurance payouts in return for helping them fight delayed, underpaid or denied claims.
The company also charges fixed or hourly fees, depending on the agreement, and says it offers no-win, no-fee arrangement.
‘We reject the claims made by Mr Dugdell on the Karl Stefanovic podcast. Claims Hero is a for-profit claims management business that is driving up the cost of general insurance for Australians.
‘Since Claims Hero’s inception in 2022, Auto & General has resolved hundreds of thousands of claims for Australians. Over the same period, Auto & General has responded to 9 claims where Claims Hero acted as a claims management company for the customer.
‘It does not have a sufficient basis for its comments. We are disappointed that Mr Stefanovic’s podcast did not explore the issues of how Claims Hero is paid.
‘We welcome the fact that ASIC has recently announced that it will review the practices of for-profit disaster chasers. We confirm that Auto & General meets its obligations under the General Insurance Code of Practice and the Privacy Act as it relates to claims documentation, when requested to provide them by our customers.
‘Since 2007, Auto & General, via it related brands, is Australia’s the most award-winning general insurer. A mark of confidence our customers can have in Auto & General, is that we have paid out over $2 billion on car and home insurance claims in the last 12 months’
SEE ALSO: Inside the Fallout That Ended a 20-Year Friendship at an Exclusive Sydney Restaurant