The corporate regulator is challenging a Federal Court ruling that a “pre-existing condition” wording in some HCF Life products did not breach unfair contract term laws.

It argues Justice Ian Jackman erred in his decision last October, when he said that while the term was liable to mislead the public, it was not unfair under the ASIC Act 2001.

The Australian Securities and Investments Commission alleges that “the term was liable to mislead the public and was an unfair contract term … because it purported to allow HCF Life to deny coverage if a consumer did not disclose a pre-existing condition before entering the contract and a medical practitioner subsequently formed an opinion that signs or symptoms of the condition existed prior to the consumer entering into the contract, even if a diagnosis had not been made”. 

ASIC says the term suggested HCF Life “could deny coverage even if the consumer was not aware of the pre-existing condition when entering into the insurance contract and a reasonable person in the circumstances would not have been aware of the condition”.

In May, Justice Jackman fined HCF Life $750,000 because the term was misleading.

See ASIC’s notice of appeal here.