Oct 15 (Businesshala) – Australia’s corporate regulator on Friday launched civil proceedings against an entity of Insurance Australia Group for failing to pay a rebate of $60 million ($44.51 million) to nearly 600,000 customers.
The Australian Securities and Investments Commission (ASIC) alleged that Insurance Australia Limited (IAL) – IAG’s home, motor and homeowners insurance arm – failed to implement the discounts offered to certain customers on renewal of their home and motor insurance policies. has been
ASIC said it affected insurance renewals related to 705,000 different policies between March 2014 and November 2019.
Shares of IAG fell nearly 4% following the news.
The regulator said the legal proceedings come on the back of industry-wide failures that have caused insurers to pay more than $400 million to more than 2 million customers since 2018.
“ASIC is asking general insurance companies, including IAL, to offer full discounts to customers,” said ASIC deputy chairperson Sarah Court.
In a separate statement, IAG, one of the country’s top insurers, acknowledged the action by ASIC and said the company had self-reported the issue to the regulator during its 2019 review.
The general insurer also said that over 80% of affected customers have been compensated and it is still working with ASIC through a treatment program.