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RAA Insurance has paid $43,200 in penalties for four ASIC advertising infringements, it has been announced.
The regulator issued four infringement notices for misleading representations made in TV advertisements aired in South Australia between December 2016 to June 2017.
In a statement, ASIC said that there were “concerned” the advertising “contained misleading representations” for the lifetime vehicle replacement benefit in RAA’s comprehensive car insurance policy.
ASIC was concerned that the adverts gave the impression that RAA would replace a consumers car with a new one if their vehicle was involved in a total loss. However, additional conditions applied to qualify for the replacement vehicle and the advertising did not “adequately disclose or explain” those additional conditions.
The additional conditions attached to the policy meant only consumers who had a car manufactured after 2014 and had insured with RAA exclusively since purchasing a new car were eligible.
The advertising did include a disclaimer but ASIC was concerned it was insufficient as it appeared in fine print at the bottom of the advert and there was “distracting” audio-visual content in the advertisement whilst the disclaimer was displayed.
“Financial service providers must make sure that the attempt to grab consumer attention in their advertising does not give misleading impressions,” ASIC deputy chair, Peter Kell said.
“Key qualifications to the headline offer must be adequately disclosed.”
RAA has ceased airing the advert.
