A policyholder who said his insurer misleadingly sold him trauma cover via an unsolicited call from his bank has lost his bid to have his premiums refunded.  

The complainant held the policy from 2005 until last year, when he cancelled it. The cover featured a $175,000 benefit for specific medical conditions, injuries and surgery.  

The man, who was 24 when the policy was incepted, said TAL Life Insurance agents inappropriately contacted him through his bank and sold him the policy over the phone. 

“I was quite young at the time and remember not knowing about these things before,” he told the Australian Financial Complaints Authority. “In the end, I just agreed to take it. I don’t even remember signing anything, just responding to the questions they asked after I had agreed to it.” 

The man argued TAL “took advantage of him through its predatory sales practices” by targeting him when he was young, and said he would not have bought the cover without its recommendations. He said he also held life insurance through his superannuation.  

TAL could not provide a recording of the phone call but denied the policy was sold inappropriately. It said that at the time of the policy’s inception, it had quality assurance over third-party providers that would have flagged any issues.  

The insurer sent a welcome letter to the man outlining that he had two weeks to reject the policy if he was unhappy with it, and subsequently provided annual renewal notices.   

The complaints authority says “no adverse inferences” can be drawn from the insurer’s inability to provide the recording given the time since it occurred.   

It says, based on the available evidence, it is fair to assume TAL appropriately provided the man with policy documents that gave him a chance to reject the policy.  

“It is not unreasonable to take into account the insurer’s usual practice at the time,” the authority’s adjudicator said. 

“On that basis, and noting the declaration the complainant made on August 3 2005, I am satisfied it is on balance more likely than not that the insurer did provide him with the [documents] before he purchased the policy. Both the letter and the policy advised the complainant that he could cancel the policy within the cooling-off period and receive a premium refund.

“He had the opportunity to consider whether the policy was suitable for him and to cancel it within the cooling-off period.”  

The authority says there are not enough details to show the insurer provided personal financial advice to the man to influence him. It also notes the man’s super statement from 2005 shows he had death benefit coverage only, not trauma benefit, which was provided by the policy.  

Click here for the ruling.