Australian Securities & Investments Commission Secures Consumer Remediation of Over $10 Million From Allianz for Travel Insurance

VICTORIA, Australia, Oct. 30 -- The Australian Securities and Investments Commission issued the following news release:

ASIC has secured $10 million in remediation from Allianz Australia Insurance Limited (Allianz) and AWP Australia Pty Ltd trading as Allianz Global Assistance (AWP) for travel insurance potentially mis-sold to around 31,500 consumers through Allianz's own website and those of its distribution partners, including Expedia.

Allianz distributes travel insurance through a number of channels, including its own website, the website of AWP, airlines, financial institutions, and travel agencies.

The refunds are for several forms of misconduct accepted by Allianz and AWP. The misconduct involved: the sale of policies to consumers who were not eligible to make a claim, partially paid travel insurance claims and the sale of policies on Expedia websites for premiums that were higher than those for the policies sold on a standalone basis.

'ASIC has taken steps to ensure customers are remediated in full for these conduct failings', said ASIC Acting Chair Karen Chester.

'Insurers need to be careful to make sure that they don't mislead consumers into thinking they have insurance cover for something when they don't. ASIC has not only initiated civil proceedings concerning an aspect of the conduct, but ensured more than 31,000 consumers are fully remediated'.

To address these conduct issues, Allianz and AWP have:

* removed the potentially misleading or deceptive statements from their websites and those of their partners;

* remediated travel insurance customers whose claims were partially paid; and

* refunded premiums, with interest, to customers who had purchased travel insurance from Allianz's own website or those of its partners.

Consumers who have concerns about their travel insurance purchased from Allianz or its partners between June 2012 and November 2018, can visit the Allianz Travel Insurance Website Review website for more information about the remediation program.

Background

On 30 September 2020, ASIC announced that it commenced court action against Allianz and AWP for allegedly misleading consumers on Expedia travel websites (20-227MR).

We note that ASIC's civil penalty proceeding only relates to the potential misleading sale of travel insurance policies that were sold through three websites run by Expedia Inc (Expedia). The remediation program relates to the misleading sale of travel insurance policies through Allianz's own website and those of its partners (including airlines, financial institutions, credit card issuers, and travel agencies). Expedia was just one of those partners.

Allianz and AWP's agreement to remediate their customers is not an admission by either Allianz or AWP that they have breached the law.