The FSC has had success in advocating for changes to the unfair contract terms regime so that it appropriately caters for life insurance.
Currently, life insurance contracts originally entered into before the regime start date for insurance of 5 April 2021 are inadvertently captured if they are replaced or reissued afterwards, which creates unintended barriers for customers because of significant compliance costs for industry in wanting to effect ordinary administrative changes to existing policies. FSC has estimated that the number of these customer requests across the industry total circa 100,000 in a given year.
New legislation introduced by Government earlier this year has proposed a fix to this issue so that it correctly excludes these administrative changes from being caught by the regime. While this legislation will not have an opportunity to be passed before the May Federal election, FSC will continue to advocate for the importance of this legislative fix when a new Government is formed.
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