Any rider who was sold “worthless add-on insurance”, such as an extended warranty, when they bought their bike through a dealer may be eligible for a refund.
The Australian Securities and Investments Commission says the worthless additions were sold to more than half a million car and motorcycle customers.
The corporate watchdog has announced another $1.7m in refunds of between $143,700 and $7.2 million to more than 30,000 customers. That brings the total to $130m over this issue.
Companies involved include Allianz, QBE, Swann Insurance and Suncorp.
The add-ons include protection insurance, consumer credit insurance, and mechanical breakdown insurance, which is also known as extended warranty.
ASIC found that some customers were sold sold mechanical breakdown insurance when cover would start after the manufacturer’s warranty expired, or where cover would expire shortly after the policy was written.
Riders who believe they have been sold these add-ons have been advised to contact their insurers to ask for their refund.
Last year’s royal commission heard evidence of questionable behaviour by several insurance companies.
ASIC Commissioner Sean Hughes says the failures highlighted by these insurers demonstrate why new design and distribution obligations – passed by the Parliament in March 2019 – are so important.
“ASIC will continue to monitor this sector to make sure the unfair practices of the past do not return; however, the industry has a key role to play in this too.”
The corporate watchdog is working to improve the design and sale of add-on insurance products to help prevent unfair sales.