TAL has offered refunds totalling $900,000 to 1,200 funeral insurance customers for failing to switch off annual cost of living increases to premiums and cover after customers reached the age of 75, for 50s/55s insurance plans, and 80, for the Insuranceline Funeral Plan.
TAL reported to the Australian and Securities Investments Commission (ASIC) that it was required by the terms of the policies to switch off the premium and cover increases, yet had failed to do so.
The insurance company has since offered eligible customers offering to refund the premiums paid or to maintain the higher level of cover with no refund.
Policy holders whose policies had lapsed would also be offered the refund.
ASIC deputy chair, Peter Kell, said customers should be confident they were not being overcharged for their insurance, and insurers needed safeguards in place to prevent this.
“When an overcharging error is identified, the insurer should act quickly to rectify the problem,” said Kell.
The funeral insurance product affected by this issue has now closed to new customers, and TAL has removed the cost of living increases from its current Insuranceline funeral insurance product.
