Consumer Action Law Centre, Financial Rights Legal Centre, and WEstjustice welcome the opportunity to comment on the proposed extension of unfair contract terms laws to insurance contracts.
There is a big ‘fairness’ problem in insurance. People often make insurance claims when they are at a low ebb, and can face shocking outcomes and no recourse under current laws when insurers rely on unfair terms. For too long, insurers have had special treatment under the law.
Unlike virtually every other industry operating in consumer markets, insurers are not subject to unfair contract terms (UCT) regime in the Australian Securities and Investments Commission Act 2001 (Cth). Insurers continue to rely on unfair contract terms to maintain their profitability and have consistently pushed back against reform.
The case for action is irrefutable, with ongoing stories of harm and endless enquires recommending the extension of UCT laws to insurance.
We strongly support the Government’s move to implement the important and long overdue extension of UCT laws to insurance. In particular, we support the Government’s commitment to implement the specific recommendation of Commissioner Hayne in the Financial Services Royal Commission (Royal Commission) Final Report on the definition of ‘main subject matter’.
