CommBank’s Insurance Arm Admits To Misleading Advertising

CommBank’s Insurance Arm Admits To Misleading Advertising
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CommInsure executive general manager Helen Troup has admitted the Commonwealth Bank arm had used outdated medical definitions in a series of insurance claim advertisements, as part of the royal commission hearing into banking.

Facing senior counsel assisting the inquiry Rowena Orr QC in court, Troup was asked whether CommInsure used misleading terms in advertisements, resulting in claims for heart attacks being rejected.

Following a 2016 investigation led by the ABC which uncovered the use of outdated definitions in the advertisements, The Australian Securities and Investments Commission (ASIC) undertook an investigation.

Despite ABC’s investigation, ASIC found CommInsure had not broken the law.

During this week’s inquiry hearing, Orr asked Troup: “Did ASIC take any enforcement action against CommInsure in relation to any of these advertisements?”

To which Troup responded: “I’m not sure if enforcement action is the correct term, but we did come to an agreement as to how to close the matter.”

Orr then asked: “CBA suggested to ASIC what ASIC should say in its media release?”

“It provided feedback, yes,” Troup said.

Commissioner Kenneth Hayne later asked Troup: “If we simply take the type of alleged contravention being singular for each advertisement, the maximum punishment was of the order of $8 million, on this maths, is that right?”

“Yes, sir,” Troup said.

Hayne asked: “At the end of the day, Ms Troup, did CommInsure come out of this process thinking that it had been punished or brought to book?” Hayne asked.

“Yes we did, sir.”

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