Industry body ICNZ to consider terminating insurer’s membership

by Maryvonne Gray 12 Aug 2016

Industry body ICNZ to consider terminating insurer’s membership

The Insurance Council of New Zealand (ICNZ) has revealed its ‘disappointment’ at one of its members, Youi, after the Commerce Commission revealed yesterday that it had filed 15 charges against the insurer in Auckland’s District Court.

ICNZ CEO Tim Grafton said the matter was to be considered at the next ICNZ board meeting, with a range of outcomes listed as possible.

These included no further action, a reprimand, an order to pay a financial penalty or, in the extreme, termination of Youi’s membership of ICNZ.

“The Insurance Council of New Zealand is disappointed with the actions and processes at Youi, which have led to the Commerce Commission laying charges in the Auckland District Court,” Grafton said in a statement today.

“The ICNZ Board will consider the charges… and whether that has impacted negatively on the reputation of the insurance industry.”

The Commerce Commission filed 15 charges against Youi NZ under the Fair Trading Act for using deceptive methods to lure potential customers.

The 15 charges are representative and relate to alleged misrepresentations made between July 2014 and February 2016.

These include:
  • making false or misleading statements on its website regarding consumers’ ability to obtain a quote online;
  • making false or misleading statements during telephone sales calls with consumers, including telling them a bank or credit card details were required to generate a policy quote;
  • asserting a right to payment for unsolicited insurance policies by sending letters demanding payment and/or debiting consumers’ bank or credit card accounts without their express permission or knowledge;
  • sending invoices to consumers in relation to unsolicited insurance policies that did not specify that the consumer was under no obligation to pay for the policies.

The Commerce Commission said Youi had cooperated with its investigation and had indicated it intended to plead guilty to the charges.

Grafton said Youi had advised ICNZ it had ‘speedily implemented’ all required changes to business practices to strengthen its compliance and to address these issues that were not part of its standard operating procedures.
 

Related stories:
Insurer charged with deceiving customers
Exposé puts insurer in bad light
Youi reports $14.8m loss during first year in NZ
 
2 Comments
  • NoNonCents 12/08/2016 3:56:39 p.m.
    CONSIDERING!!!! Why aren't they already gone?
    Post a reply
  • Garry 31/08/2016 12:09:52 a.m.
    Without hesitation YOUI is prepared to plead Guilty to procedures that are not only unethical but downright illegal and an absolute disgrace to the insurance service community. YOUI has suggested that steps are now in place to resolve and stop these criminal activities within their company.

    Why has YOUI management allowed these abuses of their clients go on for so many years?

    An ignorant man could understand that these practices were unethical and obviously illegal - yet YOUI management has not only condoned these criminal activities they reward staff for their efforts to be inventive and creative in creating false policies, their aggressively marketing of policies and their illegal deductions from accounts.

    What is there to consider - YOUI fraudulently abused thousands of victims - YOUI Intends to plead GUILTY to all charges (that they ripped clients off through fraud and dishonest processes knowingly for years)

    Now that they have been caught - and admit guilt - next step should be legal prosecution of those involved - again nothing to consider here.

    Any individual doing this to one other person, when caught, would be prosecuted to the full extend of the law - a company knowingly doing this to thousands for possibly millions of dollar of profit certainly needs no lesser consequences.

    Clean up the industry - purge the scammers - and be seen to aggressively protect the industry and the client base before they become totally distrusting of the entire industry.
    Post a reply