Can AFCA Compensation Include Indirect Financial Loss and Non-Financial Loss?

Yes. The Australian Financial Complaints Authority (AFCA) identifies three stated outcome categories: compensation for direct financial loss, indirect financial loss and non-financial loss. It also says monetary caps apply to outcomes relating to non-superannuation complaints (AFCA guidance; figures checked 1 October 2026).

These are categories of possible loss, not fixed award amounts. The cited AFCA page does not state a dollar figure for any of the three categories.

What do AFCA’s three loss categories mean?

AFCA names the categories but does not provide a standard calculation for each one. In plain English:

These descriptions explain the ordinary meaning of the labels; they are not additional AFCA legal tests. The connection between the complained-of conduct and the claimed loss must still be assessed.

Does the list mean every complaint receives all three types of compensation?

No. AFCA’s wording identifies categories that may appear in its outcomes. It does not say that every complaint qualifies for each category or that all three must be included automatically.

The list also does not state that the categories are mutually exclusive. In other words, the evidence supports neither a guaranteed combined award nor a claim that only one category can apply. The complaint facts and AFCA’s assessment determine what outcome is available.

Where do AFCA’s monetary caps apply?

AFCA says monetary caps apply to any outcomes it can provide for non-superannuation complaints. The cited page does not state:

• the amount of the cap;
• whether each loss category has a separate cap; or
• a standard amount for indirect or non-financial loss.

Therefore, “monetary caps apply” should not be read as either a guaranteed payment or a fixed award. The cap and the description of the loss are separate parts of the assessment.

An insurance policy limit is also different from an AFCA cap. A policy limit concerns the cover provided under the insurance contract, while an AFCA monetary cap concerns the outcome AFCA can provide for a non-superannuation complaint.

How does AFCA work towards a determination?

AFCA follows a complaint resolution process:

• A lodged complaint is referred to the financial firm.
• The firm reviews the complaint and attempts direct resolution within a set timeframe.
• If it remains unresolved, AFCA progresses the complaint for further consideration.
• AFCA may work with the parties towards settlement through methods such as negotiation and conciliation.
• If direct resolution does not succeed, AFCA may provide a preliminary assessment of the complaint’s merits.
• If the complainant rejects that assessment, AFCA makes a determination.

AFCA’s determinations are binding on the financial firm. Its service is free to access, although the cited material does not provide the duration of the financial firm’s response timeframe or a fixed compensation figure.

Can AFCA consider a small-business insurance complaint?

AFCA can consider some complaints about small-business insurance. These may concern an insurance broker’s conduct in following instructions or arranging a policy, or an insurer’s decision or conduct concerning an eligible small-business insurance product.

However, AFCA says its jurisdiction over general insurance complaints is limited by product type, and some types of cover are excluded. A policy does not automatically make every insurance dispute suitable for AFCA review. Check the current AFCA page for the relevant product and cover before lodging a complaint.

What should a small business check before claiming a loss?

• The current AFCA page: Confirm that the financial firm and product fall within AFCA’s jurisdiction, and check for any updated cap amount or rule.
• The Product Disclosure Statement: Review the policy’s cover, exclusions, limits and complaint provisions. The PDS does not determine AFCA jurisdiction, but it helps identify what the insurance contract provides.
• The loss evidence: Keep a clear chronology and records supporting the amount, type and connection of the claimed loss. Calling a loss indirect or non-financial does not establish entitlement by itself.
• The available resolution process: AFCA recommends submitting information for review even when it is unclear whether the complaint falls within its scope.

This is general information, not financial or legal advice. Check AFCA’s current guidance and the relevant policy PDS before making a complaint or relying on a possible outcome.

Sources

• Small Businesses with a financial complaint | AFCA

FAQ

Does AFCA automatically award compensation for all three loss categories?

No. AFCA lists direct financial loss, indirect financial loss and non-financial loss as possible outcome categories. It does not say every complaint qualifies for each category or that all three are awarded together.

Does an indirect or non-financial loss category have a fixed award amount?

No fixed amount appears in the cited AFCA guidance. The category describes the type of loss; it does not state the compensation that will be awarded.

Does an AFCA monetary cap mean each category receives the same amount?

The cited material says monetary caps apply to outcomes for non-superannuation complaints, but it does not provide a cap amount or separate limits for direct, indirect and non-financial loss. The categories should not be used to infer a particular payment.

Can AFCA review every small-business insurance dispute?

No. AFCA’s general insurance jurisdiction depends on the product type, and some types of cover are excluded. Check the current AFCA guidance for the particular policy and issue.

Does it cost anything to access AFCA’s complaint service?

No. AFCA states that its service is free to access.