The Australian Competition and Consumer Commission has warned consumers to carefully examine insurance policies offered with 'concepts' such as promotions or special deals.
ACCC Chairman, Professor Allan Fels, was commenting today on an agreement reached with one of Australia's biggest life-insurance companies, National Mutual Life Association of Australasia Ltd.
The agreement follows action taken on alleged breaches of the Trade Practices Act 1974 involving the sale of National Mutual Lifestyle Protection policies, in conjunction with the promotion of a proposed Queensland rugby league football club at Logan City, south of Brisbane.
"Over about 12 months, National Mutual's agents, IMB Group Pty Ltd and individuals associated with IMB, sold about 436 policies," Professor Fels said, "The ACCC alleges that consumers were told by the agents they would receive benefits if they 'invested' in the proposed football club (which later became known as the 'Logan Lions') and that this 'investment' could only be undertaken through a National Mutual Lifestyle Protection policy."
"It is also alleged that a number of misrepresentations were made to consumers to induce them to buy policies and 'invest' in the proposed football club. These include claims of Council approval for the development site of a football club, future value of the shares of the football club, and NSW Rugby League approval of the football club."
"The ACCC alleges this arrangement involved conduct in breach of sections 52,53 and 55A of the Trade Practices Act 1974 which prohibits misleading and deceptive conduct and false representations. Further the ACCC alleges the arrangement was in breach of section 47(6) of the Act which forbids the supply of goods or services on condition that the purchaser acquires good or services from a particular third party."
Rather than litigate over whether National Mutual was responsible for any breaches which may be established against its agents, National Mutual and the Commission agreed to a settlement.
Professor Fels acknowledged that once National Mutual was approached by the ACCC and made aware of its concerns, the company acted quickly to fully inform those of its policy holders who may have been affected and to offer complete refunds to those customers.
Action against the agents - IMB Group Pty Ltd and against Logan Lions Ltd and certain individuals will continue," Professor Fels said.
ACCC Chairman, Professor Allan Fels, was commenting today on an agreement reached with one of Australia's biggest life-insurance companies, National Mutual Life Association of Australasia Ltd.
The agreement follows action taken on alleged breaches of the Trade Practices Act 1974 involving the sale of National Mutual Lifestyle Protection policies, in conjunction with the promotion of a proposed Queensland rugby league football club at Logan City, south of Brisbane.
"Over about 12 months, National Mutual's agents, IMB Group Pty Ltd and individuals associated with IMB, sold about 436 policies," Professor Fels said, "The ACCC alleges that consumers were told by the agents they would receive benefits if they 'invested' in the proposed football club (which later became known as the 'Logan Lions') and that this 'investment' could only be undertaken through a National Mutual Lifestyle Protection policy."
"It is also alleged that a number of misrepresentations were made to consumers to induce them to buy policies and 'invest' in the proposed football club. These include claims of Council approval for the development site of a football club, future value of the shares of the football club, and NSW Rugby League approval of the football club."
"The ACCC alleges this arrangement involved conduct in breach of sections 52,53 and 55A of the Trade Practices Act 1974 which prohibits misleading and deceptive conduct and false representations. Further the ACCC alleges the arrangement was in breach of section 47(6) of the Act which forbids the supply of goods or services on condition that the purchaser acquires good or services from a particular third party."
Rather than litigate over whether National Mutual was responsible for any breaches which may be established against its agents, National Mutual and the Commission agreed to a settlement.
Professor Fels acknowledged that once National Mutual was approached by the ACCC and made aware of its concerns, the company acted quickly to fully inform those of its policy holders who may have been affected and to offer complete refunds to those customers.
Action against the agents - IMB Group Pty Ltd and against Logan Lions Ltd and certain individuals will continue," Professor Fels said.