The Australian Securities and Investments Commission (ASIC) has obtained undertakings from Sydney-based Rural & General Insurance Broking (R&GIB), and Rural & General International Insurance (R&GII) in relation to allegedly misleading content on the company’s website.

ASIC commenced proceedings against the two companies during March following concerns that RGIB’s website information “may be misleading and deceptive”.

R&GIB is an Australian-based company that brokers insurance business for Vanuatu-based unauthorised foreign insurer R&GII. Information  on its website “may have caused consumers to believe that [R&GII] was able to operate as an insurer in Vanuatu, without restriction”, ASIC said.

R&GIB agreed to permanently remove the representations from its website and to send out corrective notices “in a form acceptable to ASIC”, to every person or entity who purchased a R&GII insurance product through R&GIB between November 23 2002 and March 31 2003. It also has been told to publish a corrective notice on its website.

The undertakings were given by both companies without admissions, and both also agreed to pay ASIC’s costs.

Jan Redfern, ASIC’s Deputy Executive Director of Enforcement, said ASIC acted on the matter to “ensure that Australian consumers are not misled into believing they are protected under international laws” when they take out insurance through an unauthorised foreign insurer.

But R&GIB, which is already suing the Australian Prudential Regulation Authority for defamation, says the ASIC prosecution was “a substantial waste of public monies for little return”.

An R&GIB director (they didn’t name him) said in a statement: “If someone from ASIC had telephoned me I would have dealt with the removal of the pages immediately – ASIC didn’t need to sue us, just to telephone us.”