Australian insurer Suncorp has confirmed that its policy documents are difficult to read and understand – and they can’t do anything about it.
“As if we needed confirmation, we now have it, that laws meant to protect Australian consumers are doing the opposite,” said Jason Falinski, Chair of the Tax and Revenue Committee.
Under questioning from Jason Falinski at the House of Representatives Economics Committee, Gary Dransfield, CEO of Suncorp Insurance, admitted that their policy documents are not helping consumers understand what they are buying.
It's not a strong ability to communicate, clearly, through a dense PDS, a product disclosure statement. Even the existence of what's called the head guide—the premiums excesses and discounts guide, which does articulate some claims sample scenarios—again, is a six- or eight-page document that not everyone will have the financial capability to necessarily grapple with.
ASIC has admitted that the Corporations Law and the National Credit Code are hurting Australians to get a better deal. Commissioner Karen Chester released a report late last year admitting as much, calling a lot of financial products sludge.
But Mr Falinski said that this only tells half the story. “The truth is that our laws and ASIC are creating this sludge. The largely forgotten Royal Commission interim report strongly makes the point that Australians are faced with a blizzard of financial products that give the appearance of competition without their being actual competition.
“And now we have confirmation from one of Australia’s major insurers that this is the case, and we need to do something to fix it, and fix it now
“The truth is the Parliament and regulators have created all this sludge. We are making it more difficult for Australians to get a better deal. And we keep throwing taxpayer money at so called consumers advocates, who no one would fund if they were asked to do so voluntarily, who just argue for over regulation that benefits them, their lawyer mates and the litigation funders.
“If the parliament and regulators really want to help Australians get a better deal then we should get on with implementing smarter regulations that make it easier, not harder, for Australians to make informed choices that make sense for them, not some taxpayer funded advocate in Melbourne.”