Car Dealer Add-On Insurance class actions

Allianz Car Dealer Add-On Insurance Class Action has commenced

On 11 November 2020, Maurice Blackburn, on instructions from Mr Jordan Wilkinson, commenced a class action against Allianz Australia Insurance Limited (Allianz) in the Supreme Court of Victoria (case number: S ECI 2020 04230). The claim concerns insurance sold to consumers at car dealerships, which was “added on” to consumer loans for the purchase of motor vehicles or motorcycles (vehicles).

The Allianz Car Dealer Add-On Insurance Class Action involves the following add-on insurance products, offered by Allianz either on its own behalf or on behalf of Allianz Life Insurance Limited (Allianz Life) or OnePath Life Limited (OnePath):

  1. Loan Protection Insurance (also referred to as “repayment insurance”, “consumer credit insurance” or “CCI”);
  2. Motor Equity Insurance (also referred to as “guaranteed asset protection insurance”, “GAP insurance”, “shortfall insurance”, “purchase price insurance” or “value protect insurance”);
  3. Extended Motor Warranty (also referred to as “mechanical insurance”, “motor vehicle warranty” or “extended warranty insurance”); and
  4. Tyre and Rim Insurance.

You are eligible to register your interest in the Allianz Car Dealer Add-On Insurance Class Action if at any time between 1 June 2006 and 11 November 2020:

  1. you purchased a vehicle from a car dealer;
  2. you purchased the vehicle using a loan arranged by the car dealer; and
  3. your loan provided for payments to Allianz for any of the above add-on insurance products.

The claim alleges that Allianz:

  1. gave “personal advice” to consumers within the meaning of the Corporations Act 2001 (Cth) (Corporations Act), but breached various obligations in relation to the giving of that advice;
  2. engaged in misleading or deceptive conduct contrary to the Corporations Act and the Australian Securities and Investments Commission Act 2001 (Cth) (ASIC Act), and made false or misleading representations contrary to a provision in the ASIC Act;
  3. engaged in unconscionable conduct contrary to requirements in the ASIC Act; and
  4. wrongly induced consumers to buy the Add-On Insurance or Allianz knew or should have known that consumers who purchased Add-On Insurance did so under a mistaken belief.

A similar, but different, class action, Tracy-Ann Fuller v Allianz Australia Insurance Limited (ACN 000 122 850) and Anor (No. S ECI 2020 02853) is also being conducted in the Supreme Court of Victoria by Ms Fuller’s lawyers, Johnson Winter & Slattery.

Investigation into other class actions is ongoing

Maurice Blackburn is also investigating potential class actions against other insurers (other than Swann Insurance) (Potential Class Actions Investigation). You may be able to register your interest in the Potential Class Actions Investigation if you meet the eligibility criteria below. We will provide you with updated information as the investigation progresses.

A class action against Swann Insurance has recently settled, subject to Court approval. If you have an add-on insurance product issued by Swann please do not register for the Potential Class Actions Investigation. Instead you should contact Johnson Winter & Slattery, the law firm who conducted that class action.

The more common types of motor vehicle insurance such as comprehensive, third party property, or compulsory third-party insurance are not part of the Allianz Car Dealer Add-On Insurance Class Action or the Potential Class Actions Investigation.

It doesn’t cost you anything to register your interest in the Allianz Car Dealer Add-On Insurance Class Action or the Potential Class Actions Investigation.

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Case updates

Allianz Car Dealer Add-On Insurance Class Action filed 11 November 2020.

Am I eligible to register?

Allianz Car Dealer Add-On Insurance Class Action

You are eligible to register your interest in the Allianz Car Dealer Add-On Insurance Class Action if at any time between 1 June 2006 and 11 November 2020:

  1. you purchased a vehicle from a car dealer;
  2. you purchased the vehicle using a loan arranged by the car dealer; and
  3. your loan provided for payments to Allianz for any of following add-on insurance products, which were offered by Allianz either on its own behalf or on behalf of Allianz Life or OnePath:
    • Loan Protection Insurance (also referred to as “repayment insurance”, “consumer credit insurance” or “CCI”);
    • Motor Equity Insurance (also referred to as “guaranteed asset protection insurance”, “GAP insurance”, “shortfall insurance”, “purchase price insurance” or “value protect insurance”);
    • Extended Motor Warranty (also referred to as “mechanical insurance”, “motor vehicle warranty” or “extended warranty insurance”); and
    • Tyre and Rim Insurance.

You may need to check your documents from the purchase or financing of your vehicle to see if you paid for any of these products. Some add-on insurance products are ‘branded’ with a car or lender name. You should check that Allianz, Allianz Life and/or OnePath was the insurer on your documents.

Potential Class Actions Investigation

You are eligible to register your interest in our Potential Class Actions Investigation if:

  1. you purchased a vehicle from a car dealer;
  2. the vehicle was financed by a loan arranged by the car dealer; and
  3. your loan provided for payments to an insurer (other than Swann Insurance) for any of the following add-on insurance products:
    • Loan Protection Insurance (also referred to as “repayment insurance”, “consumer credit insurance” or “CCI”);
    • Motor Equity Insurance (also referred to as “guaranteed asset protection insurance”, “GAP insurance”, “shortfall insurance”, “purchase price insurance” or “value protect insurance”);
    • Loan Termination Insurance;
    • Extended Motor Warranty (also referred to as “mechanical insurance”, “motor vehicle warranty” or “extended warranty insurance”); or
    • Tyre and Rim Insurance.

Do not register if you purchased add-on insurance products issued by Swann. Please contact Johnson Winter & Slattery if you wish to enquire about the Swann Proceeding and settlement.  

You may need to check your documents from the purchase or financing of your motor vehicle to see if you paid for any of these products. Some add-on insurance products are ‘branded’ with a car or lender name. You should check for the insurer on your documents.

Want to find out more?

Please see below some frequently asked questions.

If you would like further information regarding the Allianz Car Dealer Add-On Insurance Class Action or the Potential Class Actions Investigation, please contact us at addonclassaction@mauriceblackburn.com.au or on 1800 497 191.

Please bear in mind that our phone lines and inbox may be quite busy with queries during this period. We will endeavour to respond to your calls and emails as soon as we can and thank you for your patience and understanding.

Frequently Asked Questions

Add-on insurance products are general insurance policies that are added on to the sale of a vehicle. They are often paid for by the loan that is taken out to purchase the vehicle.

The common types of add-on insurance sold through car dealers are:

  • Loan Protection Insurance (also referred to as “repayment insurance”, “consumer credit insurance” or “CCI”). This insures a borrower’s capacity to make repayments under a car loan, including insurance against sickness, injury, disability, death or unemployment;
  • Motor Equity Insurance (also referred to as “guaranteed asset protection insurance”, “GAP insurance”, “shortfall insurance”, “purchase price insurance” or “value protect insurance”). This covers the difference between what a consumer owes on their car loan and any amount they may receive under their comprehensive insurance policy, if the car is a total loss;
  • Loan Termination Insurance. This covers the difference between what a consumer owes on their car loan and the market value of the car if they return it because they cannot make repayments due to illness or injury;
  • Extended Motor Warranty (also referred to as “mechanical insurance”, “motor vehicle warranty” or “extended warranty insurance”). This covers the cost of repairing or replacing parts of the car due to mechanical failure after the manufacturer’s or dealer’s warranty has expired; and
  • Tyre and Rim Insurance. This covers the cost of repairing or replacing damaged tyres and rims from blowouts, punctures or other road damage.

The Australian Securities and Investments Commission (ASIC) has undertaken extensive reviews into this industry. Its reviews suggested that add-on insurance sold through car dealers represents poor value for consumers. 

Where seven or more people have claims that arise out of similar circumstances, a class action can be brought by one claimant on their own behalf and as a representative of others.

The class action process saves time and expense by avoiding the need for the courts to determine common issues of fact or law more than once. Class actions are efficient, enabling disputes and claims involving large numbers of people to be resolved via a single case.

Registering your interest in the Allianz Car Dealer Add-On Insurance Class Action or the Potential Class Actions Investigation will not expose you to any out of pocket costs. All costs in the Allianz Car Dealer Add-On Insurance Class Action and Potential Class Actions Investigation and any eventual Court proceeding/s will be borne by Maurice Blackburn unless and until there is a successful outcome.

In the event of a successful outcome in the Allianz Car Dealer Add-On Insurance Class Action, any costs payable by Maurice Blackburn will be deducted from, and will not exceed, any compensation that you are entitled to receive. All such costs are required to be considered and approved by the Court.

Nothing.

As a member of the class (and not the Representative, in whose name the case has been brought) in the Allianz Car Dealer Add-On Insurance Class Action, an adverse costs order may not be made directly against you in respect of the determination of the common issues in the class action. Unless and until there is a successful outcome, all costs will be borne by Maurice Blackburn.

Registering in the Allianz Car Dealer Add-On Insurance Class Action is an expression of interest only. If you register, it means that we can provide you with key updates about the class action. It does not mean that you will be entitled to compensation.

Registering for the Potential Class Actions Investigation is also an expression of interest only. We may contact you to ask you for further information about any add-on insurance products that you may have paid for, if you say that you are happy for us to do this when you register. We can also provide you with updates as the investigation progresses. Registering your interest in the Potential Class Actions Investigation does not mean that you will be entitled to compensation.

Registering is not required for either of the Allianz Car Dealer Add-On Insurance Class Action or the Potential Class Actions Investigation.

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