CommInsure will be paying $300,000 towards customer advice service following Australian Securities and Investments Commission (ASIC)’s raised concerns regarding misleading life insurance advertising.
The regulator’s investigation into CommInsure that began in April last year (prior to the Commonwealth Bank of Australia’s sale of it to AIA Australia) found, on review of its Total Care Plan and Simple Life Insurance policies, evidence of misleading and deceptive advertising that will see the business’ advertising sign-off process independently reviewed.
“The review looked at advertising from mid-2013 to March 2016 and found that misleading and deceptive statements are likely to have been made on some of CommInsure's websites about the extent to which customers would be entitled to cover for trauma if they suffered a heart attack,” ASIC said.
“The statements may have led a policyholder to believe they would be entitled to a lump sum payment if they suffered a heart attack in general, when in fact only certain types of heart attacks, which met certain medical criteria as defined in the policy, were covered.”
The regulator confirmed it has concluded its investigation into the life insurance business of CommInsure, with the company set a deadline of 30 June 2018 to report back to ASIC on changes implemented after the review.