IAG sued over $60m in missed discounts

THE corporate cop has launched court action against Insurance Australia Group for allegedly failing to pass on $60m in discounts to more than half a million NRMA customers.

Australian Securities and Investments Commission deputy chairwoman Sarah Court said the court action was part of the regulator’s efforts to rectify “widespread and systemic compliance failures” in the insurance industry that has resulted in insurers repaying more than $400m to more than two million overcharged customers since 2018.

“This action, taken in relation to the NRMA insurance customers, should send a fairly strong indication to the industry that we will continue to be active in this area,” she said.

ASIC alleges IAG subsidiary Insurance Australia engaged in misleading or deceptive conduct towards almost 600,000 NRMA insurance customers between 2014 and 2019 by informing them they were eligible for discounts on the renewal of their policies, but failing to apply them. IAG shares fell 3.2 per cent to $4.92 on Friday.