4.1 Manner of sale and types of products sold

4.1.1How to sell: Advice about insurance products

As I said at the start of this chapter, most life insurance policies held outside of superannuation accounts are purchased through financial advisers. In the chapter concerning financial advice, I dealt with the issues that emerged in relation to the provision of financial advice – including advice in connection with insurance products. In particular, I dealt with the provision of poor advice, which I noted is too often the result of the conflicts of interest that pervade the financial advice industry.

Conflicts between an adviser’s duty to his or her client and an adviser’s interests are a particular issue where financial advice is given in connection with insurance products, because insurance products were excluded from aspects of the Future of Financial Advice (FoFA) reforms designed to address those conflicts.

In particular, as I explained in the chapter concerning financial advice, life insurance products (other than group life policies and life policies for members of default superannuation funds) and general insurance products were exempted from the ban on conflicted remuneration introduced by the FoFA reforms. Since 1 January 2018, that position in relation to life insurance products has changed. Volume‑based benefits given to a licensee or representative in relation to information given on, or dealing in, a life risk insurance product are now subject to the ban on conflicted remuneration,[1] unless the benefit is a level commission within the applicable cap[2] and provides a ‘clawback’ arrangement if the policy is cancelled, not continued, or the policy cost is reduced in the first two years of the policy.[3]

In 2021, ASIC will review the existing arrangements for commissions in relation to life insurance products. In the chapter concerning financial advice, I said that, if that review indicates that the cap on commissions has not contributed to what is judged to be a significant degree of underinsurance, then I would urge ASIC to continue reducing the cap – ultimately, to zero. I also said that in three years’ time, there should be a review of the measures that have been implemented to improve the quality of advice, and that that review should consider whether the continued exemption of general insurance products and consumer credit insurance (CCI) products from the ban on conflicted remuneration remains justified.

4.1.2How to sell: Prohibit the unsolicited offer or sale of insurance products

As foreshadowed in the Introduction of this Report, and consistently with the Recommendation in the chapter about superannuation prohibiting the hawking of superannuation products, I would prohibit the unsolicited offer or sale of insurance products, except to those who are not retail clients and except for offers made under an eligible employee share scheme.[4]

As I have explained, share hawking has long been prohibited because it too readily allows the fraudulent or the unscrupulous to prey upon the unsuspecting.[5] Some of the case studies considered in the fourth and sixth rounds of the Commission’s hearings involved the offer or sale of insurance products in circumstances where the offeror was acting in a way that was (at the least) unscrupulous. With that said, as in the superannuation context, I consider that the root of the problem with unsolicited offers and sales of insurance is that the potential acquirer is ‘unsuspecting’.

Most, if not all, of the case studies examined by the Commission involving the unsolicited sale of insurance pertained to hawking that occurred in a telephone call.[6] When the offeror called to offer their insurance product, the potential acquirer had little or no notice that an offer was likely to be made. The potential acquirer was therefore unlikely to have considered seriously whether they needed the product that was being offered. Further, the potential acquirer was unlikely to be armed with the information that they needed to allow them to assess critically the features of the (usually complex) product that was being offered. Without this information, the potential acquirer did not know what questions they needed to ask to test the truth of what was being said or to request the details necessary to assess the suitability of the product for their circumstances.

This final point was highlighted in the evidence of Mr Gregory Martin, the Chief Actuary and Risk Officer of the ClearView Group.[7] Asked whether it was ‘possible to sell life insurance in outbound calls in a way that [was] both financially viable and legally compliant’, Mr Martin said:[8]

In retrospect I find it difficult to understand how you can reconcile those things … it would be possible to make it legally compliant. My difficulty personally with it is I just don’t understand how a customer in a phone call that lasts 20 minutes can come to a view of … understanding exactly what they’ve bought in a fairly complex sort of area of financial services.

Mr Martin distinguished that situation from the situation in which a consumer had researched the product that they wanted and then ‘rang in’ to buy it.[9]

In the course of the sixth round of hearings, the possible prohibition of the direct sale of life insurance was raised for consideration. To my mind, the preferable course is to prohibit generally the hawking of insurance products. To explain why this is so, I should say something about ASIC Report 587: The Sale of Direct Life Insurance, which was published in August 2018,[10] and which was the subject of discussion during the hearings.

In that report, ASIC examined the practices of six insurers and three distributors who sold life insurance directly to consumers.[11] In order to examine those practices, ASIC reviewed hundreds of outbound sales calls conducted both before and after the Life Insurance Code of Practice came into effect.[12] In ASIC’s first review of sales calls – relating to calls made between 2010 and 2016 – ASIC found that all of the firms included in its review had engaged in pressure selling.[13] ASIC also found that sales calls frequently included ‘inadequate explanations of future cost and product exclusions, [offers of] promotional gifts, and tactics to reduce informed decision-making’.[14]

In ASIC’s second review of sales calls – relating to calls made in July and August 2017, after the introduction of the Life Insurance Code of Practice – ASIC observed that sales conduct had improved.[15] ASIC nonetheless found that pressure selling techniques were used by some firms,[16] and that firms did not consistently provide adequate explanations of the likely future cost of the policy or of exclusions for pre-existing medical conditions.[17]

ASIC concluded that the outbound sale of life insurance was ‘more commonly associated with poor sales conduct and increase[d] the risk of poor consumer outcomes’.[18] Among other things, ASIC observed high cancellation rates of policies sold directly to consumers:

• ASIC found that 20% of all policies taken out between 2012 and 2017 were cancelled during the cooling–off period. ASIC considered that this may be taken to ‘indicate that customers had immediately realised they had made a bad decision or had been pressured into buying a policy they did not need’.[19]
• ASIC also found that ‘almost half of all policies held beyond the cooling-off period lapsed within three years’.[20]

ASIC said that claim outcomes for direct life insurance were poorer than for policies sold through other channels. Of the entities that ASIC reviewed, 27% of reported claims were withdrawn, 15% were declined, and 58% admitted.[21]

Each of these matters is concerning. But they are not problems that arise because an insurer or a distributor deals directly with a consumer. Rather, they are problems that arise because individuals are offered complex financial products – sometimes very forcefully – when they have not turned their minds to, and do not have adequate information about, what value the product has for them. Hence, the most appropriate course is to prohibit the unsolicited sale of such products.

A number of entities broadly favoured this approach, including consumer groups[22] and at least one industry body.[23] Both ASIC and the Consumer Action Law Centre (CALC) expressed the view that the current regulatory regime governing the unsolicited sale of financial products is ‘inadequate to avoid consumer detriment’.[24] ASIC said that:[25]

the anti-hawking prohibition in s[ection] 992A of the Corporations Act does not operate as a general prohibition against outbound and unsolicited sales calls, but only against offering a financial product in an unsolicited call when certain requirements (both before and during the call) are not met. The technical nature of the anti-hawking prohibition means that conduct will be exempt from the prohibition if the offeror complies with the technical requirements stipulated in the Corporations Act. Yet, even where there is compliance with these technical requirements, the risk of mis-selling and inappropriate consumer outcomes remains.

To similar effect, the Consumer Action Law Centre emphasised that the anti-hawking prohibition:[26]

allows unsolicited selling if the seller meets certain requirements. For ClearView, and perhaps other insurers, the watered-down anti-hawking requirement has seen unsolicited selling take place within structures and systems which do not ensure compliance with the law. This type of non-compliance is an inevitable risk of any laws which are relatively complex and contain loopholes which may enable businesses to go further with their practices than the ‘spirit’ of the law dictates. The anti-hawking provision is an example of laws being complicated by industry lobbying. Laws such as these, which have been heavily influenced by industry interests rather than implementation of evidence-based policy solutions, are ineffective at protecting people from harm.

I agree with both sets of observations.

Of the submissions that opposed a prohibition on unsolicited offering or selling, at least two submitted that financial services entities should be permitted to offer financial products to existing customers or members in the course of, or because of, an unsolicited meeting.[27] Consistently with the views that I have expressed in the chapter on superannuation, I do not consider that such an approach should be adopted. It would not prevent the detriments I have identified. I emphasise that I do not intend to place any restriction on the ability of insurers to contact current policyholders in relation to existing policies, including in order to notify policyholders that their insurance cover will shortly lapse.[28] But hawking insurance products should be generally prohibited.

Before leaving this topic, I add one point. To make the proposed prohibition on unsolicited offer and sales effective, and to eliminate some arguments about what is ‘unsolicited’,[29] it is desirable to introduce a statutory definition of that concept. The definition should have a breadth that achieves the purpose of the prohibition. To that end, the definition might usefully be based upon the definition now used by ASIC: that a meeting or telephone call is unsolicited ‘unless it takes place in response to a positive, clear and informed request from a consumer’.[30] And, as I have explained in the chapter on superannuation, it should be made plain that a solicited meeting, call or contact to discuss one type of product may not be used for the unsolicited offering of some other type of product.

4.1.3Specific steps in respect of particular products

A number of case studies considered the sale of low value products, including funeral insurance for the very young,[31] accidental death and accidental injury insurance, and add-on insurance sold in connection with motor vehicle purchases or credit transactions. Each of these were products that had to be ‘sold’, often very aggressively, by those who were paid commissions for every sale made. Each of them is a product that yields high profits for the issuer, almost always because the claims ratio is very low.

Many of the problems raised in connection with the sale of low value products will be met by prohibiting the unsolicited sale of financial products. Doing that should remove the pressure now associated with the sale of the products and should allow consumers to think more carefully about purchasing the product.

There are two products where I think that further steps are necessary. I outline those steps below, and then say something about ASIC’s proposed design and distribution obligations and product intervention powers.

Funeral insurance

The present exclusion of some forms of funeral insurance from the definition of ‘financial product’ should be brought to an end.[32]

As I explained in the Interim Report, the Commission took evidence about two types of funeral insurance: funeral life policies and funeral expenses policies.[33] A consumer buying a funeral life insurance policy nominates a benefit amount (typically between $5,000 and $20,000) payable, on the death of the nominated life, to a person nominated by the policyholder.[34] The recipient may apply the benefit as the recipient thinks fit.[35] By contrast, a funeral expenses policy will pay funeral costs up to a nominated limit.[36] Funeral expenses may be less than the nominated limit of cover.[37] Both types of policy are frequently sold directly to consumers.[38]

As I observed in the Interim Report, the statistics gathered by ASIC as at 30 June 2014 suggest that funeral insurance policies sold directly to consumers are of little value.[39] Those statistics indicate that at that time, there were about 430,000 policies covering about 740,000 insured lives.[40] In the 2014 financial year, more than 12,500 claims were accepted by insurers.[41] The amount paid out in claims was about one-third of the value of premiums collected over the same period. In the preceding year, the proportion was one-fifth.[42]

There was a high rate of policy cancellations.[43] Most insurers identified the cost of premiums as the most common reason for cancellation.[44]

To those statistics, I added the observations that many consumers hold policies with stepped premiums increasing with age,[45] and that many funeral insurance products carry ‘the potential for consumers to pay more in premiums over the life of the policy than they will receive as a benefit when they die’.[46]

Both the ASIC Report and the evidence given in the Commission’s fourth round of hearings indicated that Aboriginal and Torres Strait Islander people, especially those living regionally or remotely, may have been particularly likely to be sold funeral insurance policies in circumstances where those policies held little value for them.[47]

In the Interim Report, I explained that both funeral life policies and funeral expenses policies are life policies under the Life Insurance Act and contracts of life insurance under the Insurance Contracts Act.[48] However, as mentioned above, funeral expenses policies are carved out from the definition of ‘financial product’ by section 765A(1)(y) of the Corporations Act and regulation 7.1.07D of the Corporations Regulations 2001 (Cth). The effect of this carve out is that providers of funeral expenses policies are not required to hold AFSLs, are not bound by the general obligations contained in section 912A of the Corporations Act and are not presently restrained by the anti-hawking provision.

The exclusion of funeral expenses policies from the definition of ‘financial product’ cannot be justified. All forms of funeral insurance should be subject to the same regulatory regime and supervision. This is particularly important given the concerns that I hold about the value of these types of products. Many submissions received by the Commission expressed a similar view.[49] The Corporations Regulations should be amended accordingly.

As I explained in the Interim Report, some doubts have been raised about whether the consumer protection provisions of Part 2, Division 2 of the ASIC Act apply to funeral expenses policies, by reason of section 12BAA(8)(o) of that Act (it being accepted that the provisions do apply to funeral life policies). A number of submissions received by the Commission indicate that the ASIC Act provisions should be understood as applying to funeral expenses policies.[50] Nonetheless, the submissions express the view that the ASIC Act should be amended to put beyond doubt that the consumer protection provisions do apply to such policies.[51] For the reasons set out above, I agree that the ASIC Act should be amended in this way.

By taking these steps – bringing funeral expenses policies within the definition of ‘financial product’, confirming that they are within the reach of the consumer protection provisions of the ASIC Act, and, more generally, prohibiting the unsolicited sale of these products – I consider that many of the problems raised in ASIC Report 454 and in the fourth round of hearings will be resolved.[52]

Add-on insurance

I consider that two further steps should be taken in respect of the sale of add-on insurance. First, I consider that add-on insurance should generally be sold under a deferred sales model, with the exception of policies of comprehensive motor insurance. Under a deferred sales model, insurers or their representatives would be required to wait for a specified period of time before attempting to sell add-on insurance products to their customers. Second, I consider that caps on commissions should be introduced for add-on insurance sold in connection with the sale of a motor vehicle.

Turning first to the need for a deferred sales model, in the chapter on banking, I explained that I considered that the sale of add-on insurance, including add-on insurance offered in connection with the sale of motor vehicles, should move to a deferred sales model. As I said above, I exclude from this proposal policies of comprehensive motor insurance.

This proposal is consistent with ASIC’s proposal in its Consultation Paper 294: The Sale of Add-on Insurance and Warranties Through Caryard Intermediaries.[53] That proposal built on a substantial amount of earlier work done by ASIC,[54] and was motivated by concerns that:[55]

• add-on insurance products represent poor value for consumers;
• insurers pay more in commissions than in claims;
• consumer outcomes are considerably worse than in markets where there is meaningful competition; and
• consumers are at risk of unfair sales and adverse outcomes.

The justification for a deferred sales model in this context was neatly explained by ASIC:[56]

In the current sales environment, combining the sale of the car, finance and add-on products into one process restricts the capacity of consumers to consider these matters and make rational, informed purchasing decisions. The deferred sales model aims to address this by inserting a pause into the sales process.

We consider that a well-designed model would give consumers additional time to navigate the complexities of add-on products and facilitate improved decision making.

In its submissions in response to the policy questions arising from the sixth round of hearings, ASIC made substantially similar points.[57] ASIC said that it intended to conduct further consultation before finalising the details of its proposed model, and that it ultimately planned to implement that model ‘primarily by using its existing statutory powers to modify provisions of the Corporations Act’.[58]

Other submissions received by the Commission also supported the move towards a deferred sales model for add-on insurance sold in connection with motor vehicles.[59]

The move towards a deferred sales model for add-on insurance is not confined to the motor vehicle context. The 2019 Code of Banking Practice will introduce a deferred sales model in respect of CCI for credit cards and personal loans sold in branches or over the phone.[60] The purpose of this reform is said to be to reduce ‘the risk that a consumer will feel pressured to purchase the CCI product, or purchases a CCI product that does not meet their needs’.[61]

As will be apparent from what I have said, these changes will not cover the field. In particular, they will not deal with add-on insurance products sold in branches or over the phone in connection with home loans,[62] or with add-on insurance products that are purchased online.[63]

This raises difficulties of the kind the Productivity Commission recently acknowledged in its report into competition in the Australian financial system:[64]

At present, the regulatory paradigm [for add-on insurance] appears to involve ASIC in a game of whack-a-mole with insurers and their retailing partners. Legislators cannot expect the regulator to be effective in this game.

The observations made by the Productivity Commission in that report indicate that the problems evident in the motor vehicle add-on and CCI add-on contexts extend across the add-on insurance market.[65]

To deal with these issues at a systemic level, the Productivity Commission proposed introducing a deferred sales model for all add-on insurance products, ‘with a consultation period to deal with solid cases for exceptions’.[66] Several submissions to this Commission supported that approach.[67] The Productivity Commission has recommended establishing ‘a Treasury-led working group to take this objective forward’.[68] I agree that a Treasury-led working group should develop an industry-wide deferred sales model, and that it should be implemented as soon as reasonably practicable.

Second, evidence given in the Commission’s sixth round of hearings showed that the levels of commissions paid to motor vehicle dealers in connection with the sale of add-on insurance products contributed to the mis-selling of those products.[69] In its September 2016 report on the sale of add-on insurance through dealers, ASIC noted that, in the 2015 financial year, the commissions paid to dealers for the sale of add-on insurance products were as high as 79% of the premium.[70] ASIC also observed that the amounts paid in commissions on these products exceeded the amounts paid out to customers who made claims.[71]

One reason why commissions paid to dealers were so high was that insurance companies competed with each other to gain market share of distribution networks. Mr Benjamin Bessell, who gave evidence about the sale of add-on insurance policies by Swann Insurance through dealers, said that Swann viewed the dealers as its customers, rather than the consumer who purchased the insurance policy.[72]

In 2017, in recognition of the problems created by the high commissions paid to dealers, the ICA prepared a submission to the Australian Competition and Consumer Commission (the ACCC) proposing that insurers cap commissions at 20% of the premium.[73] The ACCC refused to authorise that proposal.[74] Since then, some insurance companies have taken steps to reduce the level of commissions paid to dealers.[75] But, because general insurance products and CCI products are exempt from the ban on conflicted remuneration, there is no requirement for any of those companies to limit the amount of commissions paid.

Mr Robert Whelan, the Executive Director and CEO of the ICA, accepted that commissions and volume-based bonuses paid to dealers are a significant cause of the problems that ASIC identified in its reports about the sale of add-on insurance through motor vehicle dealers. He also accepted that given many dealers were dependent on revenue from commissions, commissions and volume-based payments were particularly likely to create incentives to engage in poor sales practices.[76]

In circumstances where the peak industry body recognises that commissions can create these issues, and where the industry has indicated willingness in the past to limit the level of commissions paid to dealers, I recommend that a cap be imposed on the amount of commissions paid to motor vehicle dealers in relation to the sale of add-on insurance products. Like the existing arrangements for commissions paid in relation to life insurance products, I recommend that the level of the cap should be determined from time to time by an ASIC legislative instrument.

Product intervention, disclosure and design

Before leaving the topic of low value insurance products, it is important to say something about ASIC’s proposed design and distribution powers and product intervention powers.

As I explained in the chapter on financial advice, if the Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill 2018 (Cth) is passed, it will give ASIC powers that may go some way to altering the kinds of, and the characteristics of, products that may be sold, including low value products.

As Treasury explained, the design and distribution obligations:[77]

will require product issuers (such as insurers) to develop a ‘target market determination’ that will specify the target market for each of their products. This target market must be such that the product will likely be consistent with the likely objectives, financial situation and needs of customers within that target market.

The effect of these obligations is that if an issuer designs a product that does not meet the likely objectives, financial situation and needs of any customers – or only does so for such a narrow target market, so as to be commercially unviable – the issuer is effectively precluded from offering that product.

These obligations will also require issuers ‘who distribute their own products and third-party distributors to take reasonable steps, such that the way they market, advise on or sell products is consistent with the target market determination for that product’.[78]

The proposed product intervention power is, therefore, a complementary power ‘to make a range of intervention orders to prohibit specified conduct in relation to financial or credit products, [and] to proactively reduce the risk of significant consumer detriment’.[79]

I say that the introduction of these powers may go ‘some way’ to altering the kinds and characteristics of the products that may be sold because there are some restrictions on the breadth of the proposed powers. The design and distribution powers do not now extend to credit products. More significantly for present purposes, those powers do not extend to financial products that are not regulated by the Corporations Act, but are regulated by Division 2 of Part 2 of the ASIC Act.[80] The product intervention powers have a broader reach, but nonetheless do not extend to all ASIC Act products.[81] It is not apparent why the powers should not extend, as ASIC has requested, to all financial products and credit products within ASIC’s regulatory responsibility.[82]

In its present form, the proposed statutory regime imposes some restrictions on ASIC’s exercise of its product intervention powers. One restriction is that ASIC must be satisfied that a financial product ‘has resulted in, or will or is likely to result in, significant detriment to retail clients’.[83] ‘Significant detriment’ is said to include ‘the nature and extent of the detriment’, ‘the actual or potential financial loss to retail clients resulting from the product’ and ‘the impact that the detriment has had, or will or is likely to have, on retail clients’.[84] Another restriction is that the product intervention order is, generally speaking, limited to a period of 18 months,[85] although that period can be extended.[86] A third is that ASIC is required to consult prior to making a product intervention order.[87]

I do not mention these restrictions for the purpose of calling into doubt the value of the proposed design and distribution powers and product intervention powers, or the relevance and importance of the limitations imposed. Rather, I mention them to make the point that the powers go some way to altering the kinds and characteristics of products that may be sold, but may not solve all of the problems and issues that can arise in connection with the sale of low value products.

ASIC has said that it intends to use its product intervention powers to intervene in the sale of accidental death insurance if it remains concerned about consumer outcomes.[88] ASIC should also consider whether it should intervene in the sale of accidental injury insurance or funeral insurance if it continues to hold concerns about consumer outcomes.[89]

[1]Corporations Regulations reg 7.7A.11B.

[2]For the calendar year 2018, 80% upfront commission and 20% trail commission, reducing to 70% upfront and 20% trail in 2019 and 60% upfront and 20% trail from 1 January 2020. See ASIC, ASIC Corporations (Life Insurance Commissions) Instrument, 2017/510 (Cth) Pts 2, 3; Corporations Act ss 963B–963BA; Corporations Regulations regs 7.7A.11C(1)(d), 7.7A.11D(1)(b).

[3]See ASIC, ASIC Corporations (Life Insurance Commissions) Instrument, 2017/510 (Cth) s 6.

[4]Corporations Act ss 992A(3A) and (3B).

[5]United Kingdom, Report of the Company Law Amendment Committee, Cmd 2657 (1926), 48 [92].

[6]This was the case in respect of the Select case study in the fourth round of the Commission’s hearings, and the ClearView and Freedom case studies in the sixth round of hearings.

[7]Exhibit 6.28, Witness statement of Gregory Martin, 21 August 2018, 1 [1].

[8]Transcript, Gregory Martin, 11 September 2018, 5402.

[9]Transcript, Gregory Martin, 11 September 2018, 5402.

[10]ASIC, Report 587, 30 August 2018.

[11]ASIC, Report 587, 30 August 2018, 4 [6].

[12]ASIC, Report 587, 30 August 2018, 5.

[13]ASIC, Report 587, 30 August 2018, 7 [20].

[14]ASIC, Report 587, 30 August 2018, 7 [20].

[15]ASIC, Report 587, 30 August 2018, 7 [21]–[22].

[16]ASIC, Report 587, 30 August 2018, 8 [24].

[17]ASIC, Report 587, 30 August 2018, 8 [23].

[18]ASIC, Report 587, 30 August 2018, 58 [290].

[19]ASIC, Report 587, 30 August 2018, 6 [11(a)].

[20]ASIC, Report 587, 30 August 2018, 6 [11(c)].

[21]ASIC, Report 587, 30 August 2018, 6 [12], [14].

[22]CALC, Module 6 Policy Submission, 16–17 [48]–[53]; FRLC, Module 6 Policy Submission, 13.

[23]AFA, Module 6 Policy Submission, 13.

[24]ASIC, Module 6 Policy Submission, 20 [74]; see also CALC, Module 6 Policy Submission, 17 [51].

[25]ASIC, Module 6 Policy Submission, 20 [74].

[26]CALC, Module 6 Policy Submission, 17 [51].

[27]See, eg, NAB, Module 6 Policy Submission, 7–9 [26]–[28]; AIST, Module 6 Policy Submission, 9 [10]. See also ICA, Module 6 Policy Submission, 12–13.

[28]Cf FSU, Module 6 Policy Submission, 5 [33]–[36].

[29]As not infrequently occurred in the context of the anti-hawking provision: see, eg, Transcript, Gregory Martin, 10 September 2018, 5336–44.

[30]ASIC, Regulatory Guide 38, 2005, 9 [A2.1] (emphasis in original).

[31]FSRC, Interim Report, vol 2, 443–57.

[32]Amongst other things, this will allow the prohibition on unsolicited selling to apply to these products.

[33]FSRC, Interim Report, vol 1, 262–3. See also ASIC, Report 454, 29 October 2015, 11 [26(b)].

[34]FSRC, Interim Report, vol 1, 263.

[35]FSRC, Interim Report, vol 1, 263.

[36]FSRC, Interim Report, vol 1, 263; see also ASIC, Report 454, 29 October 2015, 11 [26(b)].

[37]ASIC, Report 454, 29 October 2015, 11 [26(b)], 27 [84]; Exhibit 4.151, April 2014, ASIC Analysis of the Funeral Insurance Sector in Australia as at 30 June 2013, 13 [50], 14.

[38]ASIC, Report 454, 29 October 2015, 9 [16].

[39]FSRC, Interim Report, vol 1, 263.

[40]FSRC, Interim Report, vol 1, 263; ASIC, Report 454, 29 October 2015, 14 [32].

[41]FSRC, Interim Report, vol 1, 263; ASIC, Report 454, 29 October 2015, 14 [35].

[42]ASIC, Report 454, 29 October 2015, 14 [35].

[43]FSRC, Interim Report, vol 1, 263; ASIC, Report 454, 29 October 2015, 16 [38]–[39].

[44]ASIC, Report 454, 29 October 2015, 16 [40].

[45]FSRC, Interim Report, vol 1, 263; ASIC, Report 454, 29 October 2015, 19 [46].

[46]ASIC, Report 454, 29 October 2015, 20 [47]; see also FSRC, Interim Report, vol 1, 263.

[47]ASIC, Report 454, 29 October 2015, 18 [43]; Transcript, Lynda Edwards and Nathan Boyle, 3 July 2018, 3747–52.

[48]FSRC, Interim Report, vol 1, 264.

[49]See ASIC, Module 4 Policy Submission, 14 [32], [33(a)]; ASIC, Interim Report Submission, 30 [139(a)]; APRA, Module 4 Policy Submission, 7 [24]; CALC, Module 4 Policy Submission, 3 [12]; CALC, Interim Report Submission, 44 [192], 45 [4.14]–[4.15]; FCA, Module 4 Policy Submission, 4 [15]; FRLC, Interim Report Submission, 15; Legal Aid NSW, Interim Report Submission, 19–20.

[50]FSRC, Interim Report, vol 1, 264. Cf ASIC, Module 4 Policy Submission, 19 [43]; CALC, Module 4 Policy Submission, 5 [16]; Legal Aid NSW, Interim Report Submission, 20.

[51]See also ASIC, Module 4 Policy Submission, 19 [43]; CALC, Module 4 Policy Submission, 5 [16]; CALC, Interim Report Submission, 44 [193]; FCA, Module 4 Policy Submission, 5 [16]; Legal Aid NSW, Interim Report Submission, 20.

[52]See, eg, Transcript, Nathan Boyle, 3 July 2018, 3750.

[53]ASIC, Consultation Paper 294, 24 August 2017, 6 [6(a)].

[54]ASIC, Consultation Paper 294, 24 August 2017, 8 [13]–[16].

[55]ASIC, Consultation Paper 294, 24 August 2017, 11–12 [30].

[56]ASIC, Consultation Paper 294, 24 August 2017, 48 [181]–[182].

[57]ASIC, Module 6 Policy Submission, 23–4 [87]–[93].

[58]ASIC, Module 6 Policy Submission, 24 [89]–[90].

[59]As to the industry peak bodies, see FSC, Module 6 Policy Submission, 17 and ICA, Module 6 Policy Submission, 15–16 and Attachment 1. As to the consumer groups, see CALC, Module 6 Policy Submission, 20–1 [64]–[68]; Consumer Credit Insurance Legal Service (WA), Module 6 Policy Submission, 9–10 [4.13]–[4.17]; FRLC, Module 6 Policy Submission, 16–17; Legal Aid NSW, Module 6 Policy Submission, 3–4.

[60]2019 Code cls 67–68.

[61]ASIC, Media Release 17-255MR, 1 August 2017.

[62]See generally Productivity Commission, Report No 89, 29 June 2018, 429.

[63]As to which, see ASIC, Media Release 17-255MR, 1 August 2017.

[64]Productivity Commission, Report No 89, 29 June 2018, 430.

[65]Productivity Commission, Report No 89, 29 June 2018, 415.

[66]Productivity Commission, Report No 89, 29 June 2018, 430.

[67]See ASIC, Module 6 Policy Submission, 23 [87], 24 [91]; FSC, Module 6 Policy Submission, 17–18; CALC, Module 6 Policy Submission, 20 [64]; FRLC, Module 6 Policy Submission, 17; Professors Allan Fels AO and David Cousins AM, Module 6 Policy Submission, 8. Cf ICA, Module 6 Policy Submission, 17.

[68]Productivity Commission, Report No 89, 29 June 2018, 431.

[69]See, in particular, Transcript, Robert Whelan, 21 September 2018, 6408.

[70]ASIC, Report 492, 12 September 2016, 16 [55].

[71]ASIC, Report 492, 12 September 2016, 17–18 [61]–[62].

[72]Transcript, Benjamin Bessell, 18 September 2018, 6098.

[73]Transcript, Robert Whelan, 21 September 2018, 6399, 6401, 6407.

[74]Transcript, Robert Whelan, 21 September 2018, 6407.

[75]Transcript, Robert Whelan, 21 September 2018, 6408.

[76]Transcript, Robert Whelan, 21 September 2018, 6408.

[77]Treasury, Module 6 Policy Submission, 2 [11]–[12].

[78]Treasury, Module 6 Policy Submission, 3 [16].

[79]Treasury, Module 6 Policy Submission, 4 [20].

[80]ASIC, Submission to Government, Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Power) Bill 2018, August 2018, 14 [52], 19 [64].

[81]ASIC, Submission to Government, Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Power) Bill 2018, August 2018, 28 [90].

[82]ASIC, Submission to Government, Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Power) Bill 2018, August 2018, 21 [69], 28 [89]–[90].

[83]Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill cl 1023D(1)(b).

[84]Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill cl 1023E(1).

[85]Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill cl 1023G(2)(a).

[86]Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill cl 1023H.

[87]Treasury Laws Amendment (Design and Distribution Obligations and Product Intervention Powers) Bill cl 1023F.

[88]ASIC, Report 587, 30 August 2018, 17 [79]. See also the analysis of the witness statements provided to the Commission relating to accidental death policies at Transcript, Senior Counsel Assisting, 12 September 2018, 5527–33.

[89]See generally ASIC, Report 454, 29 October 2015, 18 [43].