A $170 million settlement has been proposed against Allianz Insurance over the sale of car dealer add-on insurance products. This significant class action settlement, one of the largest in Australian consumer history, could see about 200,000 Australians receive compensation. Here’s everything you need to know about the settlement, eligibility, and the compensation process.
Settlement
The lawsuit, brought jointly by Maurice Blackburn and Johnson Winter Slattery, alleged that add-on insurance products sold by Allianz through car dealerships between June 1, 2006, and September 27, 2021, provided little to no value to customers.
These add-on insurance products—Loan Protection Insurance, Motor Equity Insurance, Extended Motor Warranty, and Tyre and Rim Insurance—were criticized for being sold in a way that breached Australian consumer law.
ASIC’s Findings
The Australian Securities and Investments Commission (ASIC) had long raised concerns about these add-on policies. Between 2013 and 2015, car buyers paid $1.6 billion in premiums for these products but received only $144 million in successful claims—a mere fraction of the total. By contrast, car dealerships pocketed $602 million in commissions, highlighting the questionable value of these insurance products for consumers.
Who Is Eligible
You may be eligible for compensation if you meet the following criteria:
- Purchased a vehicle from a dealership between June 1, 2006, and September 27, 2021.
- Bought one or more add-on insurance products issued by Allianz, including Loan Protection Insurance, Motor Equity Insurance, Extended Motor Warranty, or Tyre and Rim Insurance.
- Paid a premium or became liable to pay for the add-on insurance products.
To qualify, individuals must have registered for the class action before July 15, 2024, at 4 pm. Those who failed to register by the deadline won’t be eligible unless the court makes an exception.
What Happens Next?
The proposed settlement is subject to court approval, with a hearing scheduled for March 11, 2025. If the settlement is approved, registered group members will share in the settlement pool based on the following factors:
- How much they paid in premiums for their insurance policy.
- Whether they have already received refunds or claim payments from Allianz.
Group Members
Maurice Blackburn, one of the law firms leading the case, has been notifying eligible group members via text messages, emails, and postal notices.
If you’re a registered member, you don’t need to take any action unless you want to object to the settlement.
Amount
The exact payout for each individual is not yet clear. Registered members will share the settlement pool, but deductions will include:
- 25% of the settlement sum for legal costs.
- $5 million for reimbursement costs for the plaintiffs and administrative expenses.
This means the amount you’ll receive will depend on how much you paid in premiums and any prior refunds or claims you’ve received.
Key Takeaways
This settlement marks a milestone for Australian consumers who were sold low-value insurance products. While the exact compensation amount remains uncertain, eligible Australians could receive significant payouts depending on their circumstances.
If you’re eligible and have already registered, stay tuned for updates as the court decision approaches.
SOURCE – LINK
FAQs
Who is eligible for the Allianz settlement?
Those who purchased Allianz add-on insurance between 2006 and 2021.
What types of insurance are included in the settlement?
Loan Protection, Motor Equity, Extended Warranty, and Tyre and Rim Insurance.
When is the settlement approval hearing?
The court hearing is scheduled for March 11, 2025.
How much compensation will I receive?
It depends on premiums paid and prior refunds or claims.
What deductions will be made from the settlement?
Legal costs (25%) and $5 million in administrative expenses.
