Life insurer remediating $35m to over 40k customers

On Monday, it was confirmed customers who were sold life insurance policies over the phone between 2010 and 2016 are being remediated following intervention by ASIC over the last three years.

OnePath was accused of “poor telephone sales practices” including pressure selling tactics (such as promoting a deferral of the first premium payment), failing to provide information about key policy exclusions and leading the consumer to believe that the salesperson was calling from ANZ Bank with a special offer as the life insurer was owned by the bank at the time.

“For over three years now, ASIC has pursued enforcement, regulatory and remediation action to tackle misconduct and stem consumer harm in the direct life insurance market,” ASIC deputy chair, Karen Chester, said.

“ASIC has delivered deterrence through court action, disruption and improvement in sales practices and delivered compensation to tens of thousands of consumers who have suffered harm.

“Better industry practice and improved consumer outcomes followed ASIC’s deep dive review of direct sales of life insurance in 2018 and three years of concerted regulatory action.

“Notably, the deep dive review also informed the evidence base for several Hayne Royal Commission misconduct case studies. Our review uncovered egregious sales practices, with tens of thousands of consumers paying for products they did not want, did not need, or were not suitable for them.

“It’s really disappointing that despite OnePath offering refunds to around 26,000 consumers, less than one in two consumers (only 41 per cent) have banked their cheque or arranged with OnePath for their refund to be paid into their bank account.”

The remediation, which began in July 2019, is expected to finish this December.

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.