Press Release

QBE responds to ABC story

“We extend our sincere condolences to Mr O’Meara’s family. 

Mr O’Meara’s home insurance policy was issued in 2009 by ANZ acting under its own Australian Financial Services Licence and under a personal advice model. QBE was one of two co-insurers which underwrote the policy issued to Mr O’Meara by ANZ in 2009.

The policy was a full building replacement policy, which means if there was an insurable event, the insurers would rebuild the building to current building standards and requirements, no matter the subsequent costs. This is an important consideration given the remote location and the potential risk of underinsurance.

The rebuild would cover a rebuild of the home to contemporary building standards in line with the National Construction Code, including current cyclone standards. To meet current building standards required by law, the building would be substantially different and more expensive than the current structure built in 1955 and the cost of full building replacement construction is not necessarily related to the market value of property.

The premium charged reflects the costs of demolition, removal of debris and asbestos, rebuilding with cyclone-rated construction materials, labour and material transport to and from a remote location, and temporary accommodation. It also provided for the insurers to engage and cover the costs of architects, surveyors and lawyers as necessary for the rebuild, again tasks and costs which can be complex and difficult for customers, particularly with remote properties.

The premium charged also reflects the Liability cover provided which insured Mr O’Meara against liability for claim arising from an incident at the property involving the death or injury of a person or the loss or damage of another person’s property.

Mr O’Meara remained a customer for 14 years and the total of the annual premiums paid reflect the covered risks and the benefits which were to be provided in the case of an insurable event for all of those years. Mr O’Meara was provided with annual renewal notices, with the opportunity to review his policy and premiums. There was no obligation to proceed with the renewal of the cover and there was a 21 day cooling off period if he changed his mind.

In June 2023, we first became aware of Mr O’Meara’s concerns related to the cost of his premiums through his representative. We did offer free and confidential counselling at this time, as part of our complaints review. We acknowledge Mr O’Meara’s dissatisfaction with the premiums paid, however they did reflect the risks and benefits of the policy held by Mr O’Meara.

In relation to ASIC’s Pricing Promise Review, QBE continues to progress its remediation work under the supervision of the regulator and an independent assurance auditor. Remediation commenced last year with refunds issued to certain cohorts of affected customers. We are seeking to finalise our remediation and ensure all affected customers are remediated as quickly as possible. 

In relation to pricing promises specifically to ANZ household policies, the Review found that the price promises made to ANZ customers were delivered as promised, including the Over 50s Senior discount which was received by Mr O’Meara. There was no marketed retiree discount for ANZ household policies.”