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Spying on policyholders, overcharging customers and misleading sales calls - these are just a few examples of insurer misconduct being scrutinized in the 6th round of the financial services royal commission.
The new round of hearings, which kicked off on September 10 and will run through September 20, will examine 10 case studies to assess three categories of the Australian insurance industry – life insurance, general insurance, and the regulatory regime.
Day 1 of the public hearings on the insurance industry saw senior counsel assisting Rowena Orr disclosing several admissions of possible misconduct, or any conduct that fell below community standards and expectations since 2008, that were included in submissions lodged by 16 insurance companies, Reuters reported.
Dai-ichi Life’s Australian unit TAL admitted to having made hundreds of misleading sales calls, including calls to vulnerable people with limited literacy, or poor communication and comprehension skills.
“From 2012 to 2017, TAL identified that approximately 3.5% of its monitored calls were misleading sales calls according to its internal criteria,” Orr told the inquiry.
American life insurer MetLife wrote that it had spied on policyholders who had made mental-health claims.
IAG, which owns nearly 20% of the country’s life-insurance market, reported that it had identified 112 cases of misconduct, including systematic problems with its sale processes and the handling of claims.
Orr said the commission had also received reports of misconduct from the insurance units of Commonwealth Bank, Westpac Banking Corp, National Australia Bank, and Australia and New Zealand Banking Group.
