Almost 70 pet insurance products were temporarily suspended after an ASIC investigation, including products by Woolworths, RSPCA, Petbarn, Guide Dogs, Medibank, Bupa and HCF.
The insurance products were issued by The Hollard Insurance Company Pty Ltd and PetSure (Australia) Pty Ltd and applied to a range of cover options.
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ASIC issued the stop orders because of deficiencies in the target market determinations (TMD) for the products and said they were considering further stop orders for other insurance products.
Under the stop orders, no policies could be issued to new customers. The orders were valid for up to 21 days.
“ASIC made the interim orders to protect consumers from acquiring pet insurance products that may not be consistent with their objectives, financial situation or needs,” the regulator said.
ASIC said it was concerned the insurers “failed to appropriately define the target market for these products using objective and tangible parameters”.
The insurers may not have properly considered the ability of consumers to afford premiums and pay for treatments upfront before being reimbursed, ASIC said.
“It appears that the insurers did not properly consider the requirement for consumers to pay for veterinary expenses in full and upfront before receiving a partial reimbursement under a claim.”
ASIC urged insurers to take immediate steps to address these concerns.
Companies respond
“PetSure and Hollard have temporarily paused new policy sales for some insurance products as a result of ASIC concerns regarding TMD,“ PetSure said on Thursday.
“PetSure is committed to swiftly resolving these concerns by working constructively with the regulator in relation to the TMD.”
A Hollard spokesperson said: “Hollard is working collaboratively with ASIC to update the relevant documentation to include more information regarding a customer’s ability to pay for out-of-pocket costs and premiums that are subject to change over time, to ensure the TMDs are compliant.”
In an update, the spokesperson said: “Hollard can confirm after consultation with ASIC that we have addressed the concerns raised with the TMD and subsequently the interim stop order has been lifted.”
An ASIC spokesperson confirmed this.
“The interim stop orders were revoked on late Thursday afternoon, following the insurers providing ASIC with revised TMDs that addressed ASIC’s concerns,” they said.
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