AFCA backs Allianz in add-on insurance policy dispute

AFCA backs Allianz in add-on insurance policy dispute | Insurance Business Australia

AFCA backs Allianz in add-on insurance policy dispute

The Australian Financial Complaints Authority (AFCA) has ruled in favour of Allianz, rejecting consumers’ individual complaints revolving around add-on insurance policies between June 01, 2006 and July 07, 2020.

AFCA’s ruling followed submissions to the Financial Ombudsman from claims management company Claimo, insisting that it was unfair to delay complainants’ right to pursue a claim against the insurance giant individually when group members have not been notified of the class action, and an opt-out notice was unavailable.

AFCA Legal Counsel stated that complainants are likely eligible class-action members, and the Supreme Court of Victoria is dealing with the issues raised in the Allianz class action.

Claimo operation manager Nikola Araouzou, an Australian admitted lawyer, stated that the class system was not working for group members affected by the add-on insurance class actions.

“The data shows that most members will not register for compensation, or the compensation amount will not reflect the total charges paid by the policyholder,” Araouzou said. “Alternative dispute resolution channels provide consumers access to justice and remedies for free. These channels play an important social and economic role, but class actions are overriding policyholders’ right to such basic access to justice.”

Claimo noted that AFCA has the right to exclude a complaint at its “discretion” under its rules, including excluding complaints subject (or have been subject) to a class action, even if the complainant did not receive a copy of the notice or was unaware of the proceedings.

The company added: “AFCA previously decided to progress matters in the ANZ Consumer Credit Insurance Class action where no opt-out notice was available. Its decision in the Allianz class action has severely delayed complainants’ individual claims, which is extremely unfair and begs the question, what rights do consumers really have?”