A review by ASIC has found ClearView staff engaged in “poor” sales practices when selling insurance life policies directly to consumers over the phone between 1 January 2014 and 30 June 2017.
Over the 2.5 year period, ClearView sales staff sold over 32,000 life insurance policies directly to 16,000 customers, according to a statement by ASIC.
Over a thousand of these customers lived in “high Indigenous populated areas who were unlikely to have English as their first language”.
ClearView sales staff were found to have made “misleading statements about the cover, the premiums and the effect of any of the consumer's pre-existing medical conditions, did not clearly obtain consumer consent to purchase the cover before processing the premium payments, and used pressure sales tactics to sell the policies”, the statement said.
In response to ASIC’s findings, ClearView will refund all bank fees and interest to customers with high initial lapse rates, and refund 50 per cent of premiums and interest to customers with ongoing lapse rates.
Additionally, the insurer will offer eligible customers a sales call review and remediation where necessary, engage EY to provide independent assurance over the remediation program and cease selling life insurance directly to consumers who have not sought personal financial advice.
This outcome was the result of work undertaken by its Indigenous Outreach Program, ASIC said.
ASIC deputy chair Peter Kell added that pressure sales tactics were unacceptable.
“Purchasing life insurance is a key financial decision for consumers, and all the information provided to them must be clear and balanced,” he said.
“Insurers should properly supervise their sales staff and ensure that no misconduct is occurring.”
AMP appoints new group general counsel
Australian Unity hires former ANZ Wealth exec
First State Super announces new CEO
Corporate governance and advocacy in China
The shifting LIC landscape
The perils of chasing niche infrastructure