TRAVEL insurance giant Allianz and its local marketing arm AWP Australia Pty Ltd have collectively pleaded guilty to seven criminal charges of making “false or misleading statements about travel insurance”.
The Australian Securities and Investment Commission (ASIC) said the charges related to the sale of Allianz domestic and international travel insurance products, with the companies accused of misrepresenting the “characteristics or level of coverage” of their policies, some of which were promoted through Expedia websites.
In some instances, the Allianz website advertised the maximum travel insurance benefits payable to consumers, but then failed to state that sub-limits, terms, conditions or exclusions would limit those benefits.
Some policies were sold to consumers who were not eligible to make a claim, and insurance was sold on Expedia websites at higher prices than available when purchased on a standalone basis.
The conduct was under investigation by ASIC and also became the subject of a case study by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
Previous regulatory responses undertaken by ASIC in the case include securing $10 million in customer remediation for products potentially mis-sold to around 31,500 customers (TD 04 Nov 2020), as well as another $1.5 million fine relating to the Expedia sites (TD 07 Sep 2021).
The matter is now being pursued by the Director of Public Prosecutions, with an $8.1 million penalty applicable to each charge, or 10% of the company’s annual turnover.
The guilty pleas were lodged in Sydney earlier this week, with the matter now committed to the Supreme Court with a hearing listed for 05 Aug.
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Source: traveldaily
