will repay customers that paid more than $400,000 worth of premiums as part of a payday loan scheme but is unhappy with the characterisation of the case in a release from ASIC
The refund follows the recent court action by ASIC
against The Cash Store (TCS) which found TCS had “acted unconscionably” in its dealings with consumers when selling consumer credit insurance.
In a press release yesterday, ASIC
announced that Allianz
would repay the customer premiums but the insurer doesn’t think that the case was presented in the clearest light.
“We are unhappy with the way this case has been presented by ASIC
,” a spokesperson for the insurer said.
“The Cash Store sold these policies as Allianz
insurance without our permission and without our knowledge. Unfortunately, I don’t think you get that impression from the ASIC
presentation of the case.”
The case relates to the mis-sale of CCI which covers consumers against the risk of becoming unemployed, sick or dying during the period of the loan which was underwritten by Allianz
from August 2010 to March 2011, according to an ASIC
Between August 2010 and March 2012, TCS sold CCI to over 182,000 customers and these customers paid over $2.2 million in premiums for cover, with Allianz
receiving less than a third of the $400,000 it will repay.
“Less than a third of that $400,000 was ever received by Allianz
in insurance premiums but we have decided that we will refund the whole amount to customers in a gesture of good faith to those customers pulled in by this unconscionable scheme,” the spokesperson continued.
was linked to the scheme through a third-party agent and has since ceased dealings with the company.
“Our relationship with the agent ended three months after this scheme started which is why over $2 million of this product has been sold but only $400,000 of it is linked to Allianz
“The Cash Store started selling these policies 3 months after Allianz
accepted a Notice of Termination from the agent that connected us with them. ASIC
's release, on the other hand, gives the impression that the sale of the insurance was something that Allianz
was knowingly involved in, which was not the case."
deputy chairman Peter Kell
was staunch in his criticism of the conduct of TCS and noted that Allianz
had fully co-operated with the investigation.
has acknowledged that the terms of the insurance, and the way in which the insurance was sold by TCS, were not acceptable. Allianz
has cooperated with ASIC
to resolve our concerns quickly, and provide refunds to consumers,” Kell said in the statement.
The insurer will repay a total of $400, 016, with interest, to the customers affected by the case and, according to the ASIC
statement, has “also agreed to appoint an independent external firm to review its supervision of third parties to address the risk of this type of conduct occurring again.”
was unwittingly embroiled in an unconscionable insurance selling scheme by The Cash Store and we had no knowledge of it, but having said that, because we’ve accepted ultimate responsibility we have decided that we will actually repay the premiums of all the customers that bought policies from the Allianz
paper,” the Allianz