Zurich fined over false and misleading statementsBY MATTHEW WAI | MONDAY, 19 MAY 2025 11:45AMZurich Australia has paid two infringement notices totalling $37,560 issued by the Australian Securities and Investments Commission (ASIC) over alleged false and misleading statements to two policyholders. In May 2024, Zurich declined two trauma insurance claims advising the policyholders that their particular medical conditions were excluded, and no benefit was payable. The corporate watchdog alleges these statements were false or misleading as the policy terms applicable held by the policyholders did not exclude their medical conditions and they were entitled to a benefit payment. Following an assurance review, Zurich remediated the policyholders paying the entitlements with interests. Zurich reported the matter to ASIC and paid the fine on 8 May 2025. The two infringement notices have been published on ASIC's infringement notices register. ASIC said insurance claims handling was a 2024 enforcement priority for the regulator, and failures by insurers to deal fairly and in good faith with customers is a 2025 enforcement priority. The priority also seeks to enhance public confidence in the insurance industry by encouraging life insurers to "uplift" their claims handling processes and ensure consumers are not misled in any way, shape or form. "Where the handling of a claim involves a legacy product or policy enhancements passed back to existing policyholders, insurers should ensure claims staff have an awareness of, and ready access to, the applicable policy terms and conditions," ASIC said. Payment of an infringement notice is, however, not an admission of liability. Zurich has been contacted for a statement. The fine comes after the Federal Court's ruling of HCF Life Insurance at the beginning of the month - finding the insurer misled the public over a pre-existing condition term under its Recover products. HCF Life Insurance was subsequently fined $750,000 for the incident. Related News |
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