The corporate regulator is taking insurance giant QBE to court alleging that it misled loyal customers about discounts to their premiums. The insurer has previously apologised and paid back millions of dollars but ASIC is now seeking penalties.
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00:00The corporate watchdog is suing one of Australia's biggest insurers, QBE, over loyalty discounts
00:08it was offering its existing customers.
00:11Those discounts were promised in more than 500,000 renewal notices that were sent to
00:18retirees, loyalty customers, QBE shareholders and those holding multiple QBE policies.
00:26The letters promised up to 60% off, but behind the scenes it's alleged the insurer's systems
00:33had limits that wouldn't have allowed discounts this deep.
00:36We say that QBE knew that some of these pricing mechanisms were applying so that consumers
00:42were not getting the full discounts promised.
00:45QBE started looking into the issue three years ago after ASIC raised concerns.
00:51Confused customers then got letters like this saying the company had incorrectly stated
00:56savings on some policies and didn't provide enough information about when our pricing
01:01promises were limited or didn't apply.
01:05Some customers got hundreds, even thousands of dollars back with interest, others just
01:11a few bucks.
01:12So they'd send me a cheque, it was a bit of an apology, sent me a cheque for a little
01:16over $5, so with the small amount of it, it just wasn't worth it.
01:21ASIC has already brought fines against two other insurers over fake discounts.
01:27It believes that there's evidence of systemic failures with customers losing almost $400
01:33million in recent years.
01:35Insurers are very good at holding consumers to account to their fine print when it comes
01:40to claims time, but they are falling down when it comes to following through on their
01:44own promises that they've made in their advertising.
01:47QBE has apologised for its inconsistencies and says it will work with the regulator.