International insurer Ace has refused to comment as the storm over allegations of mis-selling at its wholly owned subsidiary Combined Insurance continues.

Combined insiders allege agents systematically duped customers, including vulnerable Australians, to maximise commissions.

Fairfax Media reported people were sold policies they did not need and information such as medical histories was deliberately omitted.

According to whistleblowers, agents also engaged in “tombstoning”, where dead or imaginary clients were signed up and initial premiums paid by the agents because the commissions were worth more.

Fairfax Media says NSW Police – along with the Australian Securities and Investments Commission (ASIC) – is investigating the allegations.

It reports Combined has sacked four members of staff, with further action expected.

Combined’s Australian operations were merged with Ace in 2010, but Ace has so far declined to comment on the scandal.

insuranceNEWS.com.au put a series of specific questions to Ace, and a spokesman promised to respond by late this morning.

However, all that arrived was a pre-prepared statement attributed to the Asia-Pacific head of Combined, Chris Carey.

The statement, sent more than 45 minutes after our deadline, is identical to one that appeared in Fairfax publications last week.

insuranceNEWS.com.au previously revealed this is not the first time Combined has faced investigation by the regulator. In November 2000 ASIC obtained orders in the Federal Court over the sale of inappropriate policies to members of 18 Aboriginal communities.