ASIC weighs in on insurance disclosure

ASIC weighs in on insurance disclosure | Insurance Business

ASIC weighs in on insurance disclosure
ASIC has welcomed improvements made by credit card providers surrounding the travel insurance provided with certain cards.

The regulator reviewed 17 credit card brands, from a range of issuers including Australia’s big four banks, following complaints from consumers.

The Financial Ombudsman Service (FOS) received complaints concerning uncertainty around credit card policies such as who was covered, what was covered and who issued each policy.

The review has led to four changes surrounding the products as both insurers and credit card issuers have agreed to clarify when insurance cover is ‘activated,’ particularly around minimum spend thresholds, and provide clearer and more prominent information concerning documentation needed to make a claim.

Both insurers and issuers will also clarify supplementary card holder status surrounding the insurance and the use of reward points and its role in insurance activation.

“Having travel insurance is essential for those heading on an overseas trip, to provide cover for when things go wrong,” ASIC deputy chairman Peter Kell said of the changes.

“Credit card issuers and insurers must clearly set out what is and what is not covered by a policy, so that consumers can work out if they are adequately covered.”

For those credit card issuers that offer a stand-alone travel product, the difference between both products must be made clear on company websites and  general website improvements surrounding the location of policy terms and conditions will also be actioned.