Queensland-based car insurer RACQ has announced it is making a “significant investment” to improvements its systems and processes after self-reporting a regulatory breach to the Australian Securities and Investments Commission (ASIC), a statement from the company said.
“Prior to ASIC announcing its industry-wide Pricing Promises Review, RACQ had started an internal review which identified a Product Disclosure Statement matter requiring further investigation,” said RACQ CEO David Carter.
Carter said the company appointed KPMG to provide an independent assessment of its pricing mechanics. This assessment was subsequently expanded to include ASIC’s review, leading to the discovery of the “inadequate” wording in RACQ’s product disclosure statements.
The CEO said the statements didn’t properly describe how discounts were applied to premiums, but he maintained that premiums were calculated and charged to members as intended, despite the oversight.
“The disclosure statements were corrected earlier this year to address the inconsistency,” he said.
In addition to this, the KPMG review also found a small number of cases where members may not have received the full discounts they were entitled to, the company statement said.
RACQ board chair Elizabeth Jameson said these recent discoveries show how systems “were not as strong as they should have been.”
She added that the increased investment will allow RACQ to be more flexible and efficient in addressing members’ needs, maintaining that the company remains “financially strong.”
“As a member-owned Club, we take our responsibilities and obligations seriously and will use this opportunity to ensure our members are better served as we move forward,” Jameson said. “We apologise for these errors, as they are not in keeping with our high standards and values. The remediation program will be independently monitored by an external party supporting our open, fair and transparent approach to resolving this matter for our members.”
