Programming error forces QBE to refund $1.1 million

Insurance company QBE will repay $1.1 million to customers after a programming error caused it to overcharge 11,495 Victorian-based policy holders.

Victoria’s Fire Services Levy Monitor uncovered the error after receiving numerous complaints from customers, as first reported by the AFR.

QBE has been transitioning its systems to account for the abolishment of the insurance-funded Victorian Fire Services Levy, which was scrapped in favour of a levy funded by local councils from July 1 this year.

During the transition it discovered an “inadvertent calculation error” in two of its six underwriting systems “used to determine insurance renewal premiums for some Victorian Householders policies”, it told customers.

“There was an error in the algorithm in two of our systems that resulted in them miscalculating the renewal premiums for a small percentage of policies,” a spokesperson told iTnews.

The error meant 11,495 Victorian policy holders with property coverage were overcharged when renewing their policies. Around 6 percent of Victorian customers were affected, and for many the amount overcharged was “very small”, the company said.

QBE said it would refund all those affected a minimum of $20 in acknowledgment of the inconvenience.

QBE CEO Colin Fagen said in a statement the company acted immediately to rectify the error and refund customers.