External Dispute Resolution (EDR)

External Dispute Resolution (EDR) provides consumers with access to independent, impartial adjudication of disputes with financial service providers when Internal Dispute Resolution (IDR) doesn't achieve a satisfactory outcome. In Australia, AFCA (Australian Financial Complaints Authority) is the EDR scheme for insurance and other financial services. EDR is free for consumers, while financial firms pay membership and case fees. You can access EDR if: the insurer's IDR response is unsatisfactory; the insurer doesn't respond within required timeframes (generally 30 days); or the insurer issues a deadlock letter stating they won't change their position. AFCA can make binding determinations on insurers (but not consumers) and award compensation up to $1,094,000 for insurance disputes (2024-25). The EDR process involves submitting your complaint with supporting documentation, the insurer providing their response, and an AFCA case manager reviewing all evidence and making a determination based on legal principles, relevant codes of practice, industry standards, and fairness. EDR is designed to be accessible without requiring legal representation, though some consumers choose to use lawyers or advocates.