CommInsure has pleaded guilty to 87 hawking offences.
ASIC announced that Colonial Mutual Life Assurance Society, trading as CommInsure, has entered a guilty plea for 87 counts of offering to sell insurance products in the course of unlawful, unsolicited telephone calls.
CommInsure is, and was at the relevant time, a wholly owned subsidiary of Commonwealth Bank.
"Between October and December 2014, CommInsure, through its agent, telemarketing firm Aegon Insights Australia...unlawfully sold life insurance policies known as Simple Life over the phone," ASIC said.
"CommInsure provided customer contact details to Aegon from CBA's existing customer database. The CBA customers had not requested to be contacted for the sale of Simple Life by CommInsure, or persons on CommInsure's behalf, or to receive marketing information from CommInsure."
ASIC said in all of 87 counts, CommInsure did not comply with the requirement to offer the customer the option of having the information required to be included in the Product Disclosure Statement (PDS) for Simple Life read to them prior to the offer or issue to sell the product.
In 14 of the 87 calls charged, CommInsure acknowledged it failed to give customers a PDS before becoming bound to acquire Simple Life and did not clearly inform customers of the importance of using information in the PDS when making a decision.
The case has been handed over to the Commonwealth director of public prosecutions from ASIC with details of the investigation and a prosecution brief.
CommInsure was charged by the regulator in early October and is facing up to $1.8 million in penalties.
No sentencing date has been set.
ASIC's review of the sale of direct life insurance was launched in 2018, with the regulator finding that outbound telephone sales were more commonly associated with poor sales conduct and increased risk for customers.
CommInsure has been working to compensate customers affected by the misselling of life insurance.