Is now the time to review your personal insurances?
September 9, 2020
Recently, we have seen a significant number of financial institutions hit with lawsuits in relation to misleading conduct, in particularly with advisors and planners promoting insurances with excessive premium amounts to their clients.
Individuals and customers who seek guidance from financial advisors have the right to assume a certain level of proficiency. Financial advisors have a legal duty of care to clients to:
- Obtain enough information about a client’s financial needs
- Thoroughly understand the products and services they are offering
- Act within the scope of their expertise
An example includes the case against The Commonwealth Bank of Australia.
The Commonwealth Bank of Australia (CBA) was recently hit with a class action lawsuit, which was filed to the Federal Court, by litigation firm Shine Lawyers. The accusation was made against the financial institution’s lenders and financial planners for breaching best interest duty obligations, by selling CBA customers “overpriced in house” life insurance products.
Financial advisors must abide and comply with accepted standards of practice when providing services to their clients. In certain circumstances, silence from advisors and planners can amount to misleading conduct.
Unsuitable or inappropriate advice can lead to significant losses for customers, and in the case of CBA resulting in clients paying unfairly higher premiums.
Shine Lawyers alleged that the financial institution’s financial planners failed to inform their clients that they could obtain better insurance policies with lower premiums from alternate insurers. The planners at CBA are accused of being incentivised by commission instead of focusing on their client’s best interests and needs.
Similarly, AMP Limited has been filed against by Shine Lawyers in the Federal Court for again failing to inform their clients they could obtain substantially lower premiums with other insurance providers. 100,000 clients have been estimated to be impacted as a result of this unethical financial advice.
Given these current changes happening within the personal insurance market, as well as a number of litigation matters currently underway against large financial institutions, we recommend it is now the time to review your insurances.
How can Gow-Gates help?
Gow-Gates we have a dedicated and experienced financial services team who are well positioned to help in evaluating your personal and business insurance.
Our emphasis is placed on filtering through the noise and focusing on what is the very best policy which is also cost effective for you.
We have a highly experienced team who have excellent contacts with a variety of insurers to meet our client’s best interests.
If you are uncertain about your current financial position or have questions about your personal insurances, please don’t hesitate to contact us.
Financial Services Specialists
P: 02 8267 9999