Law firm Shine Lawyers says tens of thousands of customers have joined the latest class action against Commonwealth Bank (CBA) to seek compensation for “overpriced insurance policies” allegegedly sold by its financial planners.

Shine Lawyers, acting on behalf of the plaintiffs, commenced the legal proceedings in the Federal Court this month. CBA has said it is reviewing the lawsuit and will provide any update when appropriate.

The class action is directed at CommInsure and two other CBA-owned businesses, Commonwealth Financial Planning and Financial Wisdom. Financial Wisdom has ceased providing licensee services since May 12 and no longer has advisers authorised to provide advice under its licence.

“We allege the Commonwealth Bank’s licensed financial planners failed to inform their clients they could obtain substantially similar or better insurance policies with lower premiums from alternative insurers,” Shine Class Actions Practice Leader Craig Allsopp Allsopp said.

“Instead of putting their clients’ best interests first, the planners were incentivised by commissions and other benefits to funnel people into expensive CommInsure policies.

“Customers trusted their advisors to make the best decisions for them but they were let down, and in some cases have lost thousands of dollars.”

Policyholders who bought a CommInsure cover for death, total and permanent disability, trauma, income or business protection from the two planning arms are eligible for the class action, Shine says.