Privacy Law and Policy Reporter
Insurance Reference Service (IRS) is Australia's only national database of insurance claims, providing a comprehensive and easily accessible source of insurance claims, plus commercial credit and public record information. IRS hold claims information on the major classes of general insurance throughout the whole of Australia.
Membership of IRS includes all of Australia's largest domestic insurers and most commercial insurers: AAMI; AIM; American Home Assurance; AMP General; Australian Alliance; Catholic Church; CIC; Club Marine; Colonial Mutual General; Commercial Union; FAI; GIO Australia; HBF; Lumley; Mercantile Mutual; MLC; MMI; Mutual Community; NRMA; NZI; QBE; RAA; RAC; RACQ; RACT; RACV; SGIC-SA; SGIO-WA; Sun Alliance & Royal; Suncorp; TIO; VACC; Western Underwriters; Zurich; as well as 130 insurance assessors, Loss adjusters and claims investigators. The subsidiaries of the above companies are also covered by their IRS membership.
The insurance claims database was originally established in 1984 by the Credit Reference Association of Australia Limited (CRAA), Australia's largest credit reporting agency. In 1991, IRS was formed into a separate entity, dedicated specifically to the insurance industry, and under the control of a separate board of directors, selected primarily from the insurance industry. IRS has the strong support of the Insurance Council of Australia (ICA). ICA nominates four of the eight directors on the IRS board.
IRS is a not-for-profit organisation, which is owned by its insurance members. Its operations are geared entirely towards providing a cost-efficient service for members today, and new and improved services for tomorrow. CRAA has been contracted to manage, support and develop the service on IRS's behalf.
IRS's insurance claims database provides insurers with an invaluable tool for the identification of fraudulent claims, the verification of claims history and as a measure of the underwriting risk. The insurance claims database currently holds more than 9 million claims, and is increasing by 200,000 per month. Since IRS was formed in 1992, the number of claims recorded has risen from 4 million to 9 million. Following diagrams show the types of claims in the database.
Members of IRS also have access to the commercial credit and public record files held by the CRAA
The following diagram shows the components of an IRS file.
The IRS Guardian Service gives members the ability to have their claims, cover notes and renewals automatically checked against the IRS databases.
Insurers provide regular (daily, weekly or monthly) cartridge, magnetic tape, diskette or file transfer, with details of those individuals and businesses that have lodged a claim or who have applied for a new policy. They then receive a report containing details of any prior claim activity.Online system
IRS members can access the database via a simple personal computer and modem link. This dial-up facility provides a simple and easy means of access to the Pegasus system.Direct computer to computer links
Direct links between insurers' mainframe computers and the IRS system totally automate the search and retrieval of the IRS database, providing on-line real time information prior to accepting the risk. This service is particularly valuable for the pre-checking of new business proposals.
Direct links provide the insurer with the ideal mix of security, protection and efficiency in a timely and cost-effective manner.Risk alert
Risk alert allows insurers the additional protection of monitoring individuals and businesses in which they have an interest, for a period of 12 months. As additional claims are added to the database, risk alert notifies the member by mail.Corporate searches
Up-to-date information from the Australian Securities Commission on companies, and State business and consumer affairs departments on businesses is available on-line.Electronic White Pages
IRS members also have on-line access to Telecom's Electronic White Pages facility directly from within the IRS Pegasus system.
Prices are determined by the services provided and the method of access to the database. The prices noted here are as from 1 July 1994. Membership costs insurers $12,000 pa, and insurance assessors, loss adjusters and claims investigators $465 pa. Costs of IRS inquiries range from $1.05 to $1.65 for various types of computerised inquiries, to $5.05 for phone inquiries.
The risk alert-file monitoring service allows users to monitor a file for adverse activity. Registering interest on a file is free and production of an updated IRS report costs $1.65.Comments
The individual however, changed address and reobtained insurance through another branch of Suncorp in late 1991. Suncorp, like many other insurance companies, did not retain important identity information about the individual (such as date of birth and driver's licence) and their system was not sophisticated enough to identify that this person had previously been declined insurance.Comments
IRS operates under an internally developed Code of Conduct. This IRS initiative focuses on the treatment of the privacy of those for whom IRS holds insurance claims information.
The Code places controls over who and when the information can be accessed, promotes the openness of the database to the general public, and incorporates the individual's right of access and correction of their file.
The IRS Code of Conduct is attached together with a recommended letter
1. Use of the IRS database is restricted
(a) Access to the IRS database is restricted to:
(i) staff of insurers, loss assessors and loss adjusters who subscribe to the organisation; and
(ii) those law enforcement authorities, who are authorised by the Board of IRS.
(b) The IRS database may only be used for the control of insurance fraud, in assessing risks and settling claims.
(a) The existence of IRS and its objectives should be openly promoted throughout the insurance industry and the community generally.
(b) Participating members should disclose their membership of IRS to their clients and should advise them that a restricted amount of information may be reported to IRS as part of the industry's objective of controlling fraud.
(c) Where a new proposal or a claim is principally declined as a result of information contained in the database, the member should notify the person concerned in writing and advise that a copy of that person's IRS file may be obtained by writing to IRS.
3. A right of access and correction
(a) Following from the policy of openness, members of the public and corporations should be given a right of access to their own files on the IRS database and the right to query information contained therein.
(b) Where a file is queried IRS will undertake to investigate and, where appropriate, make any necessary corrections or amendments.
(c) Should information contained in an IRS file be deleted or significantly altered, then the subject of that file should have the right to request that copies of the amended file be sent to any insurer who received the earlier information during the previous three months.
Copies of files can be obtained from: Public Access Department Insurance Reference Services Ltd PO Box 964, North Sydney, NSW, 2059 Fax No: (02) 956 7521