The Australian Securities and Investments Commission (ASIC) has announced a ban on unsolicited cold call telephone calls of direct life insurance and consumer credit insurance.
The regulator said the ban was intended to address poor sales practices that had led to unfair consumer outcomes and would take effect from 13 January, net year.
It said the ban was consistent with recommendations made by the Financial Services Royal Commission and provided protections to consumers that complement broader legislative reform by the Government.
Announcing the ban, ASIC Commissioner, Sean Hughes said the regulator would intervene to stop practices that led to poor consumer outcomes and destroy trust in the financial system.
“This action draws a clear line in the sand. From January firms will no longer be able to call consumers out of the blue and use sophisticated sales tactics to pressure people into buying life insurance and CCI products,” he said.
ASIC said the ban complemented enforcement action ASIC had undertaken for past poor sales conduct by insurers and noted that, last week, CommInsure was fined $700,000 after pleading guilty to unlawful unsolicited telephone sales of life insurance.
ASIC has also commenced civil penalty proceedings against Select AFSL Pty Ltd relating to telephone sales of life and accidental injury insurance.