The Commonwealth Bank – “Can”, or Won’t?

The Commonwealth Bank – “Can”, or Won’t?

As you may be aware, CommInsure and the Commonwealth Bank group has been outed in the media this week for unethical treatment involving the handling of insurance claims. Some of you reading this will be clients of ours who hold CommInsure policies, and you should have received personal correspondence directly from us regarding this situation already.  Please let us know if you did not receive the email and we will call you directly.

You can read about CommInsure’s situation here. In summary the investigation highlights:

  • Unethical actions around claims including denying terminal illness and sickness claims
  • Definitions not being updated with current medical procedures and advancements

 

This has been news to us just as much as it has been to you and we are deeply concerned by this.

One thing that this situation has highlighted, apart from corporate greed, is the importance of unbiased, ethical and quality advice, and a commitment to ongoing service.

The unfortunate situation for the people in the expose impacted directly by CommInsure’s alleged actions, is that they received either no, or unethical, advice and certainly no ongoing service or claims support at a time when they needed it most. Their policies were either provided by an industry super fund, Commonwealth Bank’s internal super fund or by a Commonwealth Bank financial planner. What does this mean?

  • The internal CBA and industry super funds referenced – Care Super and Hesta, as well as many others including Prime Super, Kinetic Super, NGS super, Vision Super, QIEC Super, TWU Super and more – provide no advice as their insurance options are limited to CommInsure through lucrative tenders won by the bank, which ultimately profits shareholders.
  • Commonwealth Bank financial planners have been indicted for unethical actions in the recent past.

 

Ultimately this means that the affected clients may not have receive unbiased, untarnished, quality advice, or any advice in the case of insurance through super. If you rely on your cover through any of the super funds mentioned above who use CommInsure, you may want to seek further advice because based on the current expose a denied claim could easily happen to you. Also keep in mind that this situation could easily occur anywhere there is no external adviser involved – I predict we will see a lot more of this with the rise of the online/TV insurers.

As mentioned, we sent an email to our CommInsure clients earlier this week about this situation. Several of these clients had previously claimed on their CommInsure policies set up and advised up and advised by us and experienced no issues. In fact, their responses all shared a common theme:

  • One client said: “On that record, and knowing that you are acting as my independent advisor on my insurance, I am OK staying with them”,
  • Another client: “What this has reinforced for me is that I am glad that I have Orion in my corner. I would not want to have to deal with the call centres of these large corporations on my own in such a crisis situation”
  • And another: “I’m so glad I met you for so many reasons”

 

See, for us and ultimately for you – regardless of the insurance company involved – those above comments summarise our ongoing relationship. We pride ourselves on providing unbiased, ethical and highly researched advice on setting up your protection portfolio so that you can achieve your goal of tax efficiency, cash flow management, making sure you have the right policy for your particular areas of concern and/or whatever other goals you may have in wanting to be protected. It’s a shared learning process.

The second part of our relationship is ongoing management such as your annual review– checking in to make sure the policies remain adequate for your circumstances at any given time. After all, a lot can happen in 12-24 months that may mean we need to rethink the strategies!

The third part, which is just as important as getting the setup of the strategies right, is claim time. This is when you see the true value of advice because everything that we had to do in paperwork, medicals, back and forth phone calls, financial evidence, signatures and the rest at time of setup and ongoing maintenance comes to fruition.

When you’re sick or injured, laid up in a hospital bed, emotionally spent, the last thing you want to do is be fighting an insurer. That’s our job. And that’s what these people didn’t have. We’ve always said we like to look after our clients ‘womb to tomb”!

Forgive me if this sounds arrogant but what we are able to achieve for our clients in claims over 30 years of providing advice is in many cases what these poor people have paid lawyers thousands of dollars to do. That’s not to say I am a lawyer and I do not claim to have a lawyer’s many years of experience and education. But I strongly believe an insurance company would not be so ignorant or stupid to try and decline what appear to be legitimate claims where there is an external adviser involved, which is what seems to make CommInsure’s alleged actions even more deplorable.

As advisers we know the law, we know our rights and our client’s rights and we fight for them. On top of that we are licensed to provide advice through Aon Hewitt Financial Advice. If things get rough we have at our disposal Aon’s internal lawyers who go to bat for our clients.

For example, we had a client recently who had been on claim with another insurer. That insurer had a change of heart and did not believe the client was as sick as medically stated. We got Aon involved and took it to the Financial Services Ombudsman – you can’t take it any higher than that. The Ombudsman ruled in favour of our client and the insurer in question has returned to paying our client.

What hope did these poor people in the story have if they had no one looking out for them and acting in their best interests?

But you have us.

To all our clients who have sent messages of support about their claims experience in the past few days we appreciate it very much. Not only do we feel very humbled to be able to help you in deeply personal and intimate matters, but it further reinforces why we want to ensure as many Australians as possible receive proper advice and ongoing service.

Please let us know if you have any questions, want to review your policies or wish to discuss further.

 

This article is opinion and reflects only the views of Sacha Loutkovsky. This information is general advice only, please seek advice before acting on anything in this article. 
Sacha Loutkovsky
sacha.l@orionfg.com.au
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