Medical Assurance Society New Zealand Limited (MAS), which is facing possible civil pecuniary penalties over alleged breaches of the Financial Markets Conduct Act 2013, has rolled out an unclaimed monies register in support of the mutual’s remediation process that corrects different pricing or payout errors committed by MAS.
The register was made accessible on Thursday, or the same day the Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko filed High Court proceedings against MAS over its failures.
Providing context for the case, the membership-based insurance company noted: “In recent years MAS has undertaken a fulsome review of our insurance services as part of our Conduct and Culture programme. This included proactively seeking out and investigating potential issues.
“As a result, we identified several errors resulting from manual systems, processes, and controls that impacted members and self-reported these to the Financial Markets Authority.
“The errors included the misapplication of no-claims bonus or multi-policy discounts; errors relating to the indexation of some life, health, and disability insurance policies; and underpayment of benefits under some health and disability insurance policies.”
According to MAS, it has since apologised to members for the discrepancies and provided refunds and compensation where applicable. Not all impacted members, however, have received a communication.
“We have attempted to contact all affected members; however, there are a number who we have been unable to,” said MAS, which has now publicly disclosed who those members are through the register, without publishing their full names, to try to get them to contact the insurer.
A copy of the register can be accessed here.
When the remediation was announced in 2021, MAS explained that a separate compensation is awarded on top of the refunded amount.
“If we have overcharged a member, we will refund the amount they have overpaid,” MAS declared at the time. “In addition to this, we will pay compensation for the error, to recognise the inconvenience to our members.
“We calculate compensation from the day our error occurred to 30 days after we send you notification of the refund. This gives you time to read the communication and respond with your bank account details (if we’ve asked you to) so we can make the payment.
“We use the civil debt interest calculation method to calculate the amount of compensation.”
Reimbursement sums, meanwhile, per issue or error type have been outlined by the FMA here.
While the mutual insurer is said to be “putting things right” with its remediation programme, the FMA wants MAS to be penalised for its mistakes and deficiencies.
MAS stated: “The FMA is, among other things, seeking orders requiring MAS to pay civil pecuniary penalties under the Financial Markets Conduct Act 2013. Those pecuniary penalty amounts will be paid to the Crown, rather than altering the remediation to be paid to members.
“As a mutual, MAS takes the trust our members have in us very seriously, and we apologise for the impact these errors have had. We remain committed to finding any issues and making them right. Current and former members who have any questions about these issues or the remediation can find more information on our website.
“We are unable to comment any further on the FMA proceeding while it is before the courts.”
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