Insurance Internal Quality Audit
A procedure for planning and conducting systematic internal audits to assess compliance with the quality management system and identify areas for improvement.
Purpose
To verify that the quality management system is effectively implemented and maintained, identify non-conformances and improvement opportunities, and satisfy audit requirements of quality standards.
Scope
Covers all processes, departments, and activities within the quality management system. Audits are conducted by trained internal auditors who are independent of the area being audited.
Prerequisites
- Approved annual internal audit programme and schedule
- Trained internal auditors with relevant qualifications
- Access to quality management system documentation and records
- Audit checklists aligned with quality standards and internal requirements
Aligns with ASIC regulatory requirements, General Insurance Code of Practice, and AFSL obligations. Includes audit trail provisions.
Step-by-Step Procedure
Plan the Audit
Select the process or department to be audited, define the audit scope and objectives, and prepare the audit plan.
- 1.1Review the audit programme to identify the next scheduled audit
- 1.2Define the audit scope, objectives, and criteria
- 1.3Assign the audit team ensuring independence from the area being audited
- 1.4Prepare the audit plan and checklist
Notify the Auditee
Inform the department or process owner of the upcoming audit, share the audit plan, and coordinate logistics.
- 2.1Send the audit notification with the audit plan and schedule
- 2.2Confirm availability of key personnel for interviews
- 2.3Arrange access to the work area and relevant documentation
Conduct the Opening Meeting
Meet with the auditee management to confirm the audit scope, introduce the audit team, and agree on logistics.
- 3.1Confirm the audit scope, objectives, and schedule
- 3.2Introduce audit team members and confirm roles
- 3.3Explain the audit process and confidentiality protocols
Execute the Audit
Conduct the audit by reviewing documentation, observing processes, and interviewing personnel to gather objective evidence.
- 4.1Review quality management system documentation and records
- 4.2Observe processes and work activities in the audit area
- 4.3Interview personnel to verify understanding and compliance
- 4.4Record findings with objective evidence
- Ask open-ended questions during interviews to gather comprehensive information
Analyse Findings and Prepare Report
Review all evidence collected, classify findings, and prepare the audit report.
- 5.1Review and consolidate all audit evidence and notes
- 5.2Classify findings as major non-conformance, minor non-conformance, observation, or good practice
- 5.3Draft the audit report with all findings and supporting evidence
Conduct the Closing Meeting
Present audit findings to auditee management, discuss corrective action requirements, and agree on response timelines.
- 6.1Present the audit findings and conclusions
- 6.2Discuss corrective action expectations and response timelines
- 6.3Thank the auditee team for their cooperation
Issue Audit Report and Track Actions
Distribute the finalised audit report and track corrective actions through to closure.
- 7.1Finalise and distribute the audit report
- 7.2Monitor submission of corrective action plans from the auditee
- 7.3Verify corrective action implementation and effectiveness
Quality Checkpoints
Common Mistakes to Avoid
Expected Outcomes
Percentage of scheduled internal audits completed within the programme year.
Number of non-conformances identified per audit, indicating audit thoroughness.
Percentage of audit corrective actions closed within the agreed timeline.
Frequently Asked Questions
Can employees audit their own department?
No. Auditor independence is a fundamental principle. Auditors should not audit processes or departments for which they have direct responsibility.
What qualifications do internal auditors need?
Internal auditors should complete auditor training covering audit principles, techniques, and the relevant quality standard. Practical audit experience under the guidance of an experienced auditor is also recommended.
What is the difference between an internal and external audit?
Internal audits are conducted by the organisation own staff to assess the QMS. External audits are conducted by independent third parties, such as certification bodies, to verify conformity to standards for certification purposes.
How often should internal audits be conducted?
Internal audits should cover the entire quality management system at least once per year. Higher-risk areas or processes with known issues may be audited more frequently.
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