RACQ admits insurance policy blunder; will pay back up to $220 million
RACQ will have to refund up to $220 million to insurance customers over a mistake in the wording of its insurance policies and product disclosures dating back seven years or more.
The organisation previously self reported the breach to the Australian Securities and Investments Commission and brought in KPMG, who found āother matters where members did not receive the full benefit of discountsā.
In a letter to policy holders, RACQ said the majority of funds related to the optional coversā disclosures.
āUp to 500,000 members will receive refunds because our disclosures were incorrect,ā chief executive David Carter said.
āWe are confident the premiums were calculated and charged to members as intended.
āThe total refund to members, across all pricing promising matters, is estimated to be in the range of $200 million to $220 million.
āWe will also issue refunds to those members who have not received the discounts they were entitled to, and those refunds may date back to 2013.ā
Carter said the refunds would begin in September, but admitted it could take āsome timeā to complete.
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He said the remeditiation program followed and āexceptionally challenging yearā for the insurance business.
āRACQ remains financially strong to deliver on its commitments and support its ongoing operations to serve members,ā he said.
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