Australians are being urged to check whether they are eligible for a refund on their life insurance policy if they bought one from OnePath Life between 2010 and 2016.
The Australian Securities and Investments Commission (ASIC) took action requiring that OnePath offer $35 million in remediation to customers who may have purchased policies through aggressive sales tactics or misrepresentations.
ASIC deputy chair Karen Chester said that extensive consumer harm resulted from some of OnePath’s egregious sales practices, including pressure selling tactics such as promoting a deferral of the first premium payment and using the cooling off period as an inducement to buy the product.
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Ms Chester said OnePath also failed to provide information about key policy exclusions, leading customers to believe they were calling from the ANZ bank with a special offer. OnePath was owned by ANZ at the time of the calls, but it was operating as a separate business.
“If you are a OnePath or ANZ insurance customer who has been contacted by OnePath about a refund, please respond to OnePath to arrange payment of your refund,” Ms Chester urged.
“You can also call OnePath on 1800 290 572, if you are unsure of what to do or want to check this is not a scam.”
This remediation program by OnePath follows ASIC’s 2018 review of life insurance sold directly to consumers (that is, with no financial advice and outside of superannuation), which found high cancellation rates and poor claims outcomes.
To address ASIC’s concerns about these sales practices, OnePath is:
- refunding premiums, with interest, to customers who purchased a life insurance policy that lapsed or was cancelled within two years of the sale;
- reviewing past claims and complaints; and
- waiving certain conditions for affected customers who still hold an active policy.
OnePath is writing to affected customers who purchased a life insurance policy between 2010 and 2016 with information about the premium refund arrangements.
OnePath’s customer remediation program follows ASIC’s report into the sale of direct life insurance, which found poor sales conduct resulted in consumers purchasing products that they did not want, could not afford or which did not perform as expected.
As part of that report, ASIC has also initiated legal proceedings against CommInsure for the hawking of life insurance, which led to a conviction, and instituted civil proceedings against Select AFSL, BlueInc Services and Insurance Marketing Services.
“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,” Ms Chester explained.
“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.”
Have you purchased life insurance after being sold a direct policy over the phone? Do you think you received good value from this policy or were you disappointed with the product? Why not share your thoughts in the comments section below?
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