ASIC has suspended 67 pet insurance products, including those from Woolworths and Petbarn, due to deficiencies in target market determinations.
ASIC, the independent Australian Government body responsible for regulating financial services, consumer credit, and authorised financial markets, has suspended 67 pet insurance products due to deficiencies in the target market determinations (TMD) for the products.
Woolworths and Petbarn were among those pet insurance providers issued with stop orders after the ASIC investigation. The ASIC issued stop orders relating to pet insurance schemes operated by Hollard Insurance Company Pty, a general insurer that underwrites a range of insurance products including motor, home, contents and pet insurance, and PetSure (Australia) Pty Ltd, a pet insurance provider.
ASIC has issued one stop order per TMD for each of the 38 TMDs issued by the insurers. Collectively the TMDs relate to 67 pet insurance products across different levels of cover that are distributed through various brands.
“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.”
“In particular, the insurers may not have properly considered the ‘financial situation’ (one of the key characteristics in the DDO regime) of consumers in the target market, such as their ability to afford premiums and to pay for treatments upfront before being reimbursed by the insurer (after a claim is approved),” read the statement on ASIC’s government website.
Under these orders, no new policies can be issued to new customers for 21 days, or until the order is revoked and ASIC has stated they are undergoing targeted surveillance to ensure compliance, and working with the providers to resolve the concerns.
Update June 30: As of June 30, ASIC has revoked the interim order. Petsure and Hollard have since resumed new policy sales and addressed ASIC’s feedback regarding target market determinations (TMDs).
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