Home / Daily / Withdrawn: did ASIC step in over FSC’s pandemic statement?
19 March 2020
The Financial Services Council (FSC) has withdrawn a recent statement it made on behalf of the life industry stating that existing policies have no exclusions for pandemics.
It’s understood the withdrawal was ordered by the Australian Securities and Investments Commission (ASIC), but the regulator has declined to confirm any intervention.
The original FSC statement said claims will be paid if affected policyholders have followed the Government’s travel advisory guidelines.
“No one should be concerned about their existing life insurance policies,” FSC CEO Sally Loane said in the statement.
However, the statement is now no longer available on the FSC website, and an ASIC spokesman responded to insuranceNEWS.com.au questions by declining to confirm or deny the regulator had a role in the statement being taken down.
He says that “generally life insurance policies do not have a pandemic exclusion”.
“However, we have identified some group life insurance policies that either have a pandemic exclusion that operates in the first month or so of starting a new policy or increasing cover, or they allow an insurer to activate a pandemic exclusion with notice to the super fund.”
He says some income protection policies have general pandemic exclusions, adding: “The key message is, if you have questions about your cover you should contact your insurer or your super fund or a financial adviser.”
The FSC is also coy about explaining why the statement was taken down. CEO Sally Loane told insuranceNEWS.com.au: “The COVID-19 situation is extremely fluid and the FSC continues to review the position with its life insurance members.
“We will update our website as soon as we are able.”
General insurance policies including travel covers have exclusions for pandemics and epidemics.