Allianz Australia has compensated 740 Petplan customers a total of $231,000 and its agent, Petplan Australasia, has corrected its advertising following action by regulators.

Petplan’s website promoted the Petplan insurance product with a headline statement that the policy provided a 100% rebate on claims for vet bills.

A small-print disclaimer then qualified this, stating the 100% rebate excluded a fixed excess and non-claimable items.

The Australian Securities and Investments Commission (ASIC) was concerned this created an impression that Petplan customers were entitled to a full 100% rebate.

In reality, customers cannot receive the 100% rebate value for a pet aged eight years and older. In addition to a fixed excess of $150, a variable excess amount (20% for a pet aged eight years or 35% if 10 years or older) is deducted from the final claim payment.

In response to ASIC’s concerns, Allianz has removed all references to the 100% rebate on vet bills from the Petplan website and compensated policyholders who had a variable excess amount deducted from their claim.

Allianz will also update the product disclosure statement and online sales process to clearly show the variable excess for pets aged eight years and older.

ASIC Deputy Chairman Peter Kell says promotional claims that are made in absolute terms about a potential benefit “must not create expectations that cannot be met”.

“A misleading impression created by a headline claim cannot be corrected by a small-print disclaimer.”