Review claims handling against the duty of utmost good faith
Key facts
- Human involvement
- RedLawyer-led
- How AI is used
- From the claims file, build a dated table of what the insured asked for, what the insurer did, and the date of each decision, payment, request for information or denial. Do not write a conclusion that the insurer did or did not act in good faith, and do not draft the letter that says so.
- What the lawyer must review
- The lawyer writes the advice. Section 13(1) implies into a contract of insurance a provision requiring each party to act towards the other, in respect of any matter arising under or in relation to the contract, with the utmost good faith. A failure to comply is a breach of the requirements of the Act. An insurer who fails to comply contravenes section 13(2A), and the civil penalty stated in the section is 5,000 penalty units. A third party beneficiary is a party for section 13 only after the contract is entered into. The lawyer decides whether the claims conduct met that standard.
- Written for / version
- US
Open a jurisdiction version of this task to see which instruments apply: US
Who does what
| Role | What they do |
|---|---|
| Assistance | Supporting preparation only. From the claims file, build a dated table of what the insured asked for, what the insurer did, and the date of each decision, payment, request for information or denial. Do not write a conclusion that the insurer did or did not act in good faith, and do not draft the letter that says so. The tool writes nothing into the document. Substantive advice, judgement and any restricted content remain with the responsible human. |
| Lawyer | Perform the substantive analysis and decisions. Independently check any permitted supporting work and approve the exact output for its intended use. |
Checklist
- The table cites the file note or letter for each row. It contains no adjective about good faith.
- The lawyer applies section 13(2A) to the insurer's conduct and does not invent a dollar penalty. The section states 5,000 penalty units.
- A third party beneficiary is not treated as owed the duty before the contract exists. Section 13(4) says the section applies to them only after the contract is entered into.
- The letter to the insurer or the insured is written by the lawyer.
Sources
- Insurance Contracts Act 1984 (Cth) section 13 · 2026-10-22
These are suggested working checks. Confirm the required checking with the responsible lawyer before work starts; the checking approach does not establish permission to use AI.