Regulators have joined forces to launch the Avoid a Funeral RIP-off campaign, aimed at indigenous communities.

The Australian Securities and Investments Commission (ASIC), the Australian Competition and Consumer Commission and state and territory consumer agencies will focus on funeral insurance, pre-paid funerals and funeral bonds.

“The main aim of this campaign is to provide indigenous consumers with the knowledge they need to make an informed choice if they’re thinking about purchasing a funeral savings or insurance plan,” ASIC Deputy Chairman Peter Kell said.

“Indigenous consumer advocates and legal groups regularly tell ASIC that a lack of understanding and knowledge about the features and range of funeral products leads to consumers signing up to products that are expensive and do not suit their needs.”

The campaign is co-ordinated by the intergovernmental National Indigenous Consumer Strategy group.

NSW Fair Trading Commissioner Rod Stowe says many indigenous people are unaware of their rights and are “often targeted by dodgy traders”, including insurance representatives.

“Some consumers have signed up for funeral insurance without realising that if they cannot make all the scheduled payments the policy may be cancelled and they lose all the money they have already paid.”

Queensland Office of Fair Trading Executive Director Brian Bauer urges indigenous consumers to consider all options before signing up for funeral products.

“Despite entering into these contracts with the best of intentions, to spare their family a financial burden, many indigenous consumers are losing significant amounts of money on funeral products,” he said.

“Complex contracts and unscrupulous traders can disguise both the real costs involved and the benefits paid out.”

The campaign shows indigenous consumers they can seek assistance from other sources, including superannuation, health insurance and government bereavement benefits.

Compliance officers from consumer protection agencies are reviewing contracts for various funeral products and scrutinising claims made in advertising and promotions.

And Mr Kell warns ASIC is monitoring funeral insurance providers and will take action where instances of misleading or deceptive conduct are identified.

“Where ASIC has identified issues with a particular firm, we will not hesitate to take appropriate enforcement and regulatory action to lift standards and ensure better outcomes for all consumers,” he said.