The Victorian Supreme Court has approved a $170 million settlement in a class action against Allianz Australia over add-on insurance sold through car dealerships, while another action has been filed against Adica. 

The Allianz action related to consumer credit insurance, guaranteed asset protection, extended warranty, and tyre and rim products bought through dealerships between June 1 2006 and September 27 2021.

Separate actions filed by solicitors Maurice Blackburn and Johnson Winter Slattery were combined in 2021.

The court approved the settlement, without admission of liability, last month and has appointed Maurice Blackburn as scheme administrator. An appeal period will expire early next month.

The class action alleged Allianz breached advice rules and engaged in misleading and unconscionable conduct in sales processes for the add-on products. 

The insurer denied the claims and the settlement decision says its defence was “lengthy and detailed”.

An Allianz spokesperson told insuranceNEWS.com.au the company agreed last year to a settlement related to the historical sale of add-on insurance and no longer issues the products that were the subject of the class action.

Another class action over the sale of add-on insurance has been filed by Echo Law in the Victorian Supreme Court against Toyota Finance and Aioi Nissay Dowa Insurance Company Australia (Adica).

The filing relates to people who took out car loans with Toyota Finance and were sold Toyota-branded add-on insurance policies between January 1 2010 and October 5 2021.

Principal lawyer Alex Blennerhassett says the class action holds the companies to account for “knowingly selling junk insurance”.

“Many consumers were ineligible to claim on their policies, despite paying thousands of dollars for them,” she said. “In other cases, consumers were never told the insurance policies had been added to their car loan, or were told it was a requirement that they purchase the insurance.”

The Supreme Court has allowed the case to be managed along with a separate filing against Toyota Finance over allegedly inflated interest rates on car loans. Echo Law expects a significant number of people will be group members in both proceedings.

The add-on insurance class action is supported by Australian litigation funder Litigation Lending Services.

The Allianz court settlement approval is available here.