Information Request: Deferred Sales Model Class Exemptions
The Financial Rights Legal Centre (Financial Rights) and Consumer Action Law Centre (Consumer Action) long held position has been that there should be few if any exemptions at all to the Deferred Sales Model (DSM).
Implementing an industry wide DSM for add-on insurance was one of the key recommendations Commissioner Hayne made for the insurance industry. Known behavioural biases inherent in the add-on sales process have been long exploited by the insurance industry and their retailing partners, which have prioritised making a quick buck over selling suitable insurance products that people want and need.
The sale of these products continues to cause significant consumer harm, particularly in situations where excessive commissions are being paid to retailers for pushing poor value – and sometimes worthless – insurance products: see Jenny’s story below regarding exorbitant, unneeded add-on comprehensive car insurance that was ultimately unsustainable and worthless.
Read the full submission (PDF).
If you think you’ve been ripped off and sold junk insurance, check out our DemandARefund website.
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