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Call for action to curb funeral insurance

4 Jul 2018

Legal Aid NSW is calling for reform and regulation around the sale of funeral insurance following evidence given today at the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

Kathy Balngayngu Marika - an Aboriginal woman originally from Arnhem Land whose first language is not English – told the Royal Commission that she felt pressured into signing up with Let’s Insure in 2015.

“I found it really hard to understand what the man was saying to me on this call,” she said in her statement.

“Even when I did know the words, it was sometimes hard for me to keep up with what he was saying, because I have to swap between Yolngu matha and English in my head.”
She said she did not understand that the policy was for her children and grandchildren, as well as for herself.

The 60-year-old great-grandmother also told the Commission that she was offered vouchers if she passed on contact details of friends and family, but said she did not understand what those vouchers were for.

“When I sat down and thought about the funeral insurance I had taken out, I realised that it was far too much money for me to pay,” she said.

Legal Aid NSW CEO Brendan Thomas said today’s evidence highlights a wider issue about the sale and aggressive marketing of funeral insurance to Aboriginal communities, and to vulnerable people generally.

“Funeral insurance targets by its nature the most vulnerable in our community,” he said.

“It’s an unsuitable product that often costs many times the actual value of the funeral.

“Specifically, there should be an obligation on insurers to assess whether or not the product is suitable.

“And there should mandated disclosure on the likely costs of premiums compared to the value of the funeral.”

“We have called for action on funeral insurance for many years. The time for action is now.”