Australian regulators will ban telephone sales of life insurance after an inquiry into cold calling found egregious acts of misconduct.
The ban will be effective as of January 13, 2020, according to the Australian Securities and Investments Commission (ASIC), in order to stamp out mis-selling.
«[The ban intends to] stop practices that lead to poor consumer outcomes and destroy trust in the financial system», said Sean Hughes, ASIC director, in a statement. «From January, firms will no longer be able to call consumers out of the blue and use sophisticated sales tactics to pressure people into buying life insurance and [consumer credit insurance] products.»
Spotlight on telephone sales of life insurance has already unveiled misconduct with the likes of Commonwealth Bank of Australia, which was convicted for breaches of anti-hawking law last week and fined A$700,000 ($477,000) for unsolicited phone sales calls between October and December 2014.
In another even more brazen act of mis-selling, a Royal Commission inquiry last year found a telephone salesperson pushing complex insurance products to a 27-year old male with Down Syndrome and evidently lacked knowledge about the area.
