6.3 What the case study showed

I have already made findings of misconduct and conduct falling below community standards and expectations above. In summary, I have found that:

In respect of the member charged a higher premium after delinking, AMP’s conduct fell below community standards and expectations by failing to communicate with the member in an effective way that he was being charged a higher premium because a non-smoking declaration had not been completed.
In respect of the deduction of premiums from the accounts of deceased members after being notified of the death:

AMP Super and AMP Life may have engaged in misconduct by breaching section 912A(1)(a) of the Corporations Act.
AMP Super may have engaged in misconduct by breaching the duty imposed by section 52(2)(b) of the SIS Act to act with the skill and diligence of a prudent trustee.

In respect of the failure to refund premiums deducted after the date of death:

AMP Super may have engaged in misconduct by breaching sections 29VC and 52(2)(b) of the SIS Act and sections 912A(1)(a) and (c) of the Corporations Act. [1]
AMP Life may have engaged in misconduct by breaching section 912A(1)(a) of the Corporations Act.

All of the misconduct and conduct falling below community standards and expectations was caused, at least in part, by AMP’s systems. Some of those systems failed to promote the best interests of members in various ways. The most striking example was provided by the second issue – the continued charging of life insurance premiums to member’s accounts after death. AMP’s previous process for stopping premiums eschewed the ‘obvious’ solution of turning the premium deductions off upon notification of death.[2] No reason was given for that choice. Mr Sainsbury accepted that it was ‘not the best way’ to deal with the issue.[3] That is clear from the complaints received by AMP about the continued deduction of premiums after death. Those complaints were raised, at the latest, by 2016, but no action was taken to adopt the ‘obvious’ solution until 2018.