September 18, 2018
ClearView Life has written to financial advisers explaining that its recent testimony at the Banking Royal Commission applied to a closed direct life business and provided them with a form letter for clients highlighting the difference with advised retail insurance.
The note to advisers, signed by ClearView Managing Director, Simon Swanson apologised for any concerns the testimony of ClearView Chief Actuary and Risk Officer, Greg Martin may have caused for advisers. It also stated the insurer has been working with ASIC to compensate direct insurance customers who may have experienced unfair sales practices between 1 January 2014 and 30 June 2017.
At the hearings, Martin conceded that ClearView’s direct life insurance business may have breached the anti-hawking provisions of the Corporations Act on more than 300,000 occasions, driven by inappropriate commission structures and sales cultures (see: ClearView Admits to 300,000 Breaches of Anti-Hawking Regulations).
In the note, Swanson said, “We understand that many of your clients may be concerned following this negative press especially if they hold a ClearView product,” adding the templated letter may assist advisers communicating with clients that held a ClearView advised product.
“We understand that many of your clients may be concerned following this negative press…”
The letter to clients stated the direct life insurance business closed in mid-2017 and the client’s adviser “…have never had anything to do with ClearView Direct business…which was a very small part of the broader ClearView group”.
Further distinction was made between the direct life insurance business and the service provided by advisers with the latter stating the former sold products over the phone, under a general advice model while advised clients “…receive quality professional advice that’s designed to meet your unique needs and assist them in achieving their goals”.
Earlier this year, ASIC required ClearView to refund $1.5 million to 16,000 customers after the regulator found it had used unfair and high pressure sales practices when selling products directly to consumers (see: ClearView to Pay $1.5M for Poor Direct Life Sales Tactics).