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Liberty Specialty Markets
Liberty Specialty Markets

Allianz charged with making false statements about travel products

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Allianz Australia and its subsidiary AWP face criminal charges accusing them of making false or misleading statements on a range of domestic and international travel insurance products between 2016 and 2018.

Allianz was the underwriter of the products and AWP the distributor that sold the policies to customers, the Australian Securities and Investments Commission (ASIC) said in a statement today.

The insurer faces seven counts of false or misleading representations and AWP has one similar charge against it.

The charges allege that Allianz and AWP “published information online, including on Allianz’s domestic, basic and comprehensive travel insurance web pages, that misrepresented the characteristics or level of coverage of travel insurance on sale to consumers,” according to the statement.

“In some instances, ASIC alleges that Allianz’s website advertised the maximum travel insurance benefits payable to customers, but failed to state that particular sub-limits, terms, conditions or exclusions could operate to limit those benefits.”

The case is listed for further mention on April 20 after the two companies appeared today at the Downing Centre Local Court in Sydney.

The criminal proceedings come after the regulator announced last October it had secured $10 million in remediation from the insurer and AWP for travel insurance products that were “potentially mis-sold” to some 31,500 customers. The products were sold through Allianz’s own website and its distribution partners including Expedia.

The remediation is not an admission by either Allianz or AWP that they have breached the law.

ASIC says the criminal charges filed today are part of its regulatory responses after the Hayne royal commission referred the insurer’s alleged misconduct to the regulator. The charges are separate to the civil proceedings lodged in the Federal court against Allianz and AWP for allegedly misleading consumers on Expedia travel websites.

A spokesman for Allianz told insuranceNEWS.com.au the insurer will make no further comment on the criminal proceedings as the matter is now before the court.

“Allianz has acknowledged the shortcomings in relation to the sale of travel insurance products on some websites, as identified during the royal commission,” the spokesman said.

“A review undertaken by Allianz in 2018 highlighted issues relating to the identification or description of the limits, sub-limits and exclusions that would apply to particular policies. The website content has since been addressed.

“Since the royal commission, Allianz has undertaken a comprehensive program to strengthen our organisational governance, including further investing in risk and compliance and refining our product offerings with the aim of achieving the best outcomes for our customers.”