The AMP Life public submission to the hearings said that counsel assisting had raised three specific insurance issues, being AMP default premiums for non-smokers, AMP properly managing managing member’s accounts after death and whether the group managed incapacity benefits in MySuper Products.
“AMP rejects each of the open findings put forward by Counsel Assisting on these matters,” its submission read.
The royal commission heard from counsel assisting Rowena Orr that AMP was aware that it was charging dead customers life insurance premiums as far back as 2016.
Ms Orr said that the AMP may have engaged in misconduct by continuing to deduct insurance premiums from deceased members, may have failed to notify the regulators of the continued deductions and their actions may have fallen below community standards.
However, the AMP in their public submission seemed to deny that their actions had been in misconduct.
“These findings are also not open on the evidence. AMP strenuously objects to the proposed open findings and submits that the propositions put forward by counsel assisting are not available,” it said.
AMP said its policy was to cease payment of premiums on the date of death and seemed to put the onus back on the family members of the deceased.
“AMP is, of course, reliant upon a member’s estate contacting it to inform it of a member’s death. Often, this notification process is not instantaneous, and it may be that AMP is unaware of a member’s death for some time,” it said.
The AMP also objected to the Ms Orr’s findings that it may have engaged in misconduct by authorising the deduction of premiums from members’ accounts where those premiums are calculated on a statistically inappropriate basis.
The open findings specifically targeted members that were reported to have been charged smoker premiums despite being non-smokers and said this action may have been a breach of the SIS Act.
AMP said the findings are not open on the evidence.
“AMP objects to these open findings and submits that the propositions put forward by counsel assisting are predicted on two incorrect factual premises and are otherwise unsupported by the evidence,” AMP said.
AMP said that it was wrong to stay that AMP assumed members are smokers by default as the policy does not make that assumption.
“AMP calculates the premiums that it charges to members based on actuarial assessments that reflect the risk for the relevant pool of insureds based on the information available to it,” it said.
Ms Orr also suggested in her open findings that AMP may have engaged in misconduct by not ensuring that at least one of its MySuper members were provided with permanent incapacity benefits on an opt-out basis.
This conduct would amount to a breach of section 68AA of the SIS Act and it was also suggested by the commission that it may also have fallen below community standards.
“These findings are also not open on the evidence. AMP not only states that the open finding sought is simply not available to the royal commission, it positively asserts that the case study in question is an illustrative example of how AMP’s dispute resolution processes entirely meet community standards and expectations,” it said.
