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General Insurance Case Study

Time limits for lodging disputes 


This article provides a general insurance case study to illustrate how the time limits for lodging disputes under our Terms of Reference (TOR) operate. 

Terms of Reference

Paragraph 6.2 of the TOR sets time limits for lodging disputes.  The parts of paragraph 6.2 relevant for general insurance disputes are as follows:


… FOS will not consider a Dispute unless the Dispute is lodged with FOS before the earlier of the following time limits:

  1. within six years of the date when the Applicant first became aware (or should reasonably have become aware) that they suffered the loss; and
  2. where, prior to lodging the Dispute with FOS, the Applicant received an IDR Response in relation to the Dispute from the Financial Services Provider – within 2 years of the date of the IDR Response."

However, FOS may still consider a Dispute lodged after either of these time limits if FOS considers that exceptional circumstances apply.

Case Study

An Applicant, whose building was destroyed by fire on 1 August 2004, lodged a claim with the Financial Services Provider (FSP) the following day. The Applicant understood that the FSP accepted the claim. The FSP requested certain documentation from the Applicant. However, several months later, he still had not provided the documentation. The FSP decided to pay the Applicant an amount it believed to be appropriate in order to settle the claim.

The Applicant, who received the FSP’s cheque on 1 June 2005, believed he was entitled to a far greater amount. He unsuccessfully attempted to resolve the matter with the FSP during the subsequent years.

The Applicant lodged a dispute with FOS on 1 March 2011 and received a final decision letter from the FSP on 1 June 2011.



Whether the dispute was lodged within the time limit under our TOR.



To determine the time limit under paragraph 6.2b)(i), FOS needed to establish when the Applicant first became aware (or should reasonably have become aware) that he suffered the loss to which the dispute related.  The time limit under paragraph 6.2b)(ii) did not apply because he did not receive an IDR Response before he lodged his dispute with FOS.

While the fire occurred in 2004, that incident only gave rise to a claim under the Applicant’s policy.  The loss to which the dispute related was the difference between the amount of the cheque that he received on 1 June 2005 and the amount to which he believed he was entitled.  He first became aware that he suffered that loss when he received the cheque.  There was no suggestion that he should reasonably have become aware, before 1 June 2005, that he suffered that loss. 

In our assessment, paragraph 6.2b) allowed the Applicant to lodge the dispute with FOS within six years after 1 June 2005.



Since the dispute was lodged within the applicable time limit, FOS was able to consider it.