The AMP Life public submission to the hearings said that counsel assisting had raised three specific insurance issues, being AMP default premiums for non-smokers, AMP properly managing managing member’s accounts after death and whether the group managed incapacity benefits in MySuper Products.
“AMP rejects each of the open findings put forward by counsel assisting on these matters,” its submission read.
The royal commission heard from counsel assisting Rowena Orr that AMP was aware that it was charging dead customers life insurance premiums as far back as 2016.
Ms Orr said that AMP may have engaged in misconduct by continuing to deduct insurance premiums from deceased members, may have failed to notify the regulators of the continued deductions and their actions may have fallen below community standards.
However, AMP in their public submission seemed to deny that their actions had been in misconduct.
“These findings are also not open on the evidence. AMP strenuously objects to the proposed open findings and submits that the propositions put forward by counsel assisting are not available,” it said.
AMP said its policy was to cease payment of premiums on the date of death and seemed to put the onus back on the family members of the deceased.
“AMP is, of course, reliant upon a member’s estate contacting it to inform it of a member’s death. Often, this notification process is not instantaneous, and it may be that AMP is unaware of a member’s death for some time,” it said.
AMP also objected to Ms Orr’s findings that it may have engaged in misconduct by authorising the deduction of premiums from members’ accounts where those premiums are calculated on a statistically inappropriate basis.
The open findings specifically targeted members that were reported to have been charged smoker premiums despite being non-smokers and said this action may have been a breach of the SIS Act.
AMP said the findings are not open on the evidence.
“AMP objects to these open findings and submits that the propositions put forward by counsel assisting are predicted on two incorrect factual premises and are otherwise unsupported by the evidence,” AMP said.
AMP said that it was wrong to say that AMP assumed members are smokers by default as the policy does not make that assumption.
“AMP calculates the premiums that it charges to members based on actuarial assessments that reflect the risk for the relevant pool of insureds based on the information available to it,” it said.
Ms Orr also suggested in her open findings that AMP may have engaged in misconduct by not ensuring that at least one of its MySuper members were provided with permanent incapacity benefits on an opt-out basis.
This conduct would amount to a breach of section 68AA of the SIS Act and it was also suggested by the commission that it may also have fallen below community standards.
“These findings are also not open on the evidence. AMP not only states that the open finding sought is simply not available to the royal commission, it positively asserts that the case study in question is an illustrative example of how AMP’s dispute resolution processes entirely meet community standards and expectations,” it said.
Where did the AMP Chairman previously work? Enough said!
amp deny the earth is round what next wtf.
Finally someone is coming back at the RC! How is AMP or any other company going to verify a persons death if they are not provided with a death certificate? Some logic needs to prevail at some point surely?
Unfortunately in any industry there are legal and privacy restraints that hold matters up but that’s not necessarily a deliberate attempt to defraud customers.
Errors also happen but it seems that within the Financial Services the Royal Commission believes there are no room for error nor do they factor in all the restraints being, system, process and legal that companies and advisers need to manage. Very unrealistic.
Come on AMP! I have seen numerous examples where clients have been automatically placed on smoker rates after being rolled out of their former employer’s AMP corporate super plan onto an AMP personal super plan. Most of the clients didn’t even realise this had happened! To say you didn’t do this is a load of rubbish!
The RC Counsel Assistings’ approach of aggressive intimidation in front of a live video feed encouraged most witnesses to play a dead bat and meekly submit to whatever was hurled at them. It would have been a painful waste of time for witnesses to try to explain the facts when their inquisitor was clearly not interested in hearing anything other than a confirmation of their predetermined judgement.
While this may have made for good media fodder, it hasn’t helped the Commissioner or the public get a proper understanding of the situation. It will likely lead to even more insane bureaucracy that ultimately makes consumers worse off.
Will insurance companies now be forced to ring their clients up every month to ask if they’re dead yet? And lodge a form with ASIC on each occasion? And submit a breach notice if the form isn’t completed within 3 days of the end of month?
I would normally – on principle – never click ‘like’ on a comment from Anonymous – but this mouse makes some very sensible comments.
I concur. This is more an unveiling of, and travesty of extremely poor human behavior than it has to do with a particular industry. It just so happens to focus is on peoples money rather than their cars, house or property, mobile phones, etc. etc.
I find it interesting that AMP and the banks have very articulate and strong defences when given the time to wordsmith a written response. No doubt it took an army of AMP lawyers and internal resources to come up with this written defence. However when an AMP executive (or bank executive) are put in a witness box they cower and tell the truth which paints them in a very bad lite. It is how they operate. Finding the grey blurry line of legality to spin a profit. Their public rhetoric of looking after the financial well being of customers is BS!
And didn’t the examining counsel have the advantage of surprise and exploit that for all it was worth. Over blown accusations and distortions that were not able to be contested in the RC as that is not permitted.
About time AMP pushed back and congratulations for NAB showing some spine.
Terrific to see them stand up to the commission and illustrate its flaws and lack of knowledge on a industry it really doesn’t understand
A person is not “dead” until the Death Certificate is produced, (often a delay of three to six weeks) otherwise Advisers and Institutions could be the subject of fraud or mischievous claims! Secondly the Estate Trustees/Executors administering managed investments often need continuing advice until a grant of Probate and distribution of the estate occurs and this can take many months or years.
Oh it is so easy being a lawyer with only logic as your tool of trade, and no experience to help you in making judgements. How much are these Lawyers being paid for faulty, shallow, incorrect, headline grabbing pronouncements??????
How good would it be to have a professional association come out and say this is blatantly wrong and not how financial services companies should operate.
Instead, they take payments from them and stay quiet.
What were the total death benefits paid on the 4000 odd deceased who had delayed refunds?
Contrite response from AMP. Obviously nothing to see here.