Allianz and AWP to pay $1.5 million penalty
The Federal Court of Australia (Federal Court) has ordered Allianz Australia Insurance Limited (Allianz) and its related arm AWP Australia Pty Ltd (AWP) to pay a $1.5 million penalty after pleading guilty to charges of making false or misleading statements about travel insurance, according to the Australian Securities and Investments Commission (ASIC).
The charges revolved around the sale of Allianz domestic and international travel insurance products and statements published online on various domestic, basic, and comprehensive travel insurance websites hosted and maintained by Allianz and AWP – with the latter having marketed, sold, and managed various travel insurance products on behalf of Allianz.
Specifically, between 2016 and 2018, both companies misrepresented their travel insurance’s characteristics or level of coverage. In some instances, Allianz’s website advertised the maximum travel insurance benefits payable to consumers, but failed to state that sub-limits, terms, conditions, and exclusions will limit these benefits.
Read more: ASIC strips AFS license from Epic Property Investments
Allianz and AWP were investigated by ASIC and became a subject of the Royal Commission into Misconduct in the Banking, Superannuation, and Financial Services Industry’s (Royal Commission) case study.
After its investigation, ASIC had undertaken regulatory responses to the misconduct, including securing $10 million in customer remediation from Allianz and AWP for travel insurance potentially mis-sold to approximately 31,500 customers through the Allianz website and its distribution partners, including Expedia.
The corporate watchdog also took action against both companies regarding the sale of travel insurance policies through Expedia websites, resulting in the $1.5 million penalty ordered by the Federal Court.
The conclusion of the issue involving Allianz and AWP follows ASIC’s decision to revoke Epic Property Investments Ltd’s (Epic) Australian financial services (AFS) license.
