AFCA (Australian Financial Complaints Authority)
AFCA is Australia's free external dispute resolution body. Builders escalate insurance claim denials here after IDR; 2-year limit from the final response.
Ask Chalkline about this →AFCA is the Australian Financial Complaints Authority, the free external dispute resolution (EDR) body for complaints about financial services in Australia. AFCA was established in November 2018 under Part 7.10A of the Corporations Act 2001 (Cth), replacing three predecessor schemes (Financial Ombudsman Service, Credit and Investments Ombudsman, Superannuation Complaints Tribunal).
For a builder, AFCA is the escalation path when an insurer denies, underpays, or stalls a claim on contract works (CAR), public liability, professional indemnity, or other insurance you hold as part of your business.
When a builder uses AFCA
The typical scenario: a CAR or PI claim is denied or short-paid by the insurer. The first step is always the insurer’s Internal Dispute Resolution (IDR) process. Only after IDR has issued a final response (or 30 calendar days has passed without one) can a complaint go to AFCA.
| Step | Time limit |
|---|---|
| 1. Lodge complaint with insurer’s IDR team | At the time of dispute |
| 2. Receive insurer’s IDR final response | Insurer must respond within 30 calendar days |
| 3. Lodge complaint with AFCA | Within 2 years of the IDR final response |
Missing the 2-year deadline extinguishes the right to AFCA’s free determination. After that, the only avenue is private litigation.
What AFCA can do
AFCA can:
- Investigate the complaint independently of the insurer.
- Mediate or arrange conciliation between the parties.
- Make a binding determination against the insurer (binding on the insurer, not on the complainant who can decline and pursue court).
- Order monetary remedies up to scheme limits (most insurance claim caps sit at $1,085,000 plus interest as at 2024-25, indexed annually).
Cost
Complaints are free for the complainant at every step. The insurer pays scheme fees.
What AFCA cannot do
- Hear disputes against parties who are not AFCA scheme members (most consumer-facing insurers are members; verify before lodging).
- Award penalty or punitive damages beyond compensation for the loss.
- Review a court judgment on the same matter.
- Replace a builder’s solicitor for complex, multi-party, or fraud-tainted disputes; see builder’s solicitor: when to engage one.
Process snapshot
- Lodge online at afca.org.au with the dispute summary, IDR correspondence, and supporting documents.
- AFCA case manager triages and contacts the insurer for a response (typically 21 days).
- Conciliation conference (phone) attempted.
- If unresolved, AFCA investigates and issues a written determination.
- Determination becomes binding on the insurer once accepted by the complainant.
Typical timeline: 3-9 months from lodgement to determination, faster for straightforward claims.
Also known as: Australian Financial Complaints Authority, financial ombudsman.
Category: Insurance / dispute resolution.
Related
See also
Last updated: 2026-05-16. Verified: 2026-05-16.