With insurance sales practices proving a focus of the Royal Commission’s current hearings, the Commission has heard of how Freedom sold a disabled man funeral insurance and final expenses cover through a sales call in which the consumer showed limited to no understanding of the product.
The man’s father, Grant Stewart, appeared before the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry this morning, said that his son had not understood the product he signed up for until the billing and product information arrived in the mail.
It then took Stewart two phone calls and an email to cancel the policy – which he described as “a difficult process to go through” – before lodging a complaint with the Australian Securities and Investments Commission (ASIC).
When complaining to Freedom, Stewart was told that his son had signed up to 12 months’ free cover on the plan, which the Freedom employee continuously emphasised was a service only offered by Freedom.
Transcripts of the original sales call revealed however, that the Freedom salesperson who spoke to Stewart’s son also upsold the original Freedom protection plan cover to include accidental death cover.
Throughout the call, the sales person’s explanations of the product to Stewart’s son were greeted with monosyllabic agreement. Stewart felt that this call made it clear his son did not understand what he was signing up to.
Stewart labelled the sales call as “unfair” on his son, saying that the sales rep sounded as though “he had a script in front of him and he was asking the questions he needed to ask to get the answers they wanted”.
Since the call, Stewart said his son had become “quite apprehensive about answering his phone” and no longer would answer it unless he knew the number calling.
Freedom chief operating officer, Craig Orton, formally apologised to Stewart and his son during his testimony later in the day’s hearings.
