Shine investigates class action over ‘unnecessary insurance’ sales
19 September 2022
Compensation law firm Shine Lawyers is investigating a possible class action against Aussie Home Loans for allegedly selling “unnecessary insurance” to customers who may already have had similar or better life coverage.
The law firm says the Mortgage Protection Policy product sold by the home loan and mortgage broker “was ultimately of limited or low value” because there were other products available which were cheaper and provided substantially better cover.
The policy was touted as a kind of life insurance which would help cover home loan repayments in the event of illness, loss of employment or death, according to Shine Lawyers.
Shine says its investigation will examine whether the brokers owed a duty of care to act in their client’s best interest, whether that duty was breached, and whether their sale of the product was misleading or deceptive, or amounted to unconscionable conduct.
insuranceNEWS.com.au has reached out to Aussie Home Loans for a response to the matter.
Shine Lawyers Class Actions Practice Leader Rebecca Jancauskas says it was often the first homebuyers who handed over an extra thousand dollars or more a year to pay for the policies.
“It’s hard enough to get a foot on the property ladder, and if brokers are selling unnecessary insurance it makes it even harder,” Ms Jancauskas said.
“Buying a home is a complex and stressful process. We’re investigating whether Aussie Home Loans exploited its clients by selling them a policy that was essentially worthless.”