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The Full Federal Court has dismissed ASIC’s appeal against an earlier Federal Court ruling that a term in house and contents insurance policies issued by Auto & General Insurance Company Limited (Auto & General) was not unfair. The term required policy holders to notify Auto & General if ‘anything’ changed in their home and contents. 

½ñÈÕÈÈÃÅʼþalleged in the proceeding that the term was unfair as ½ñÈÕÈÈÃÅʼþconsidered it:  

• imposes an unclear obligation on policyholders regarding what they need to disclose to Auto & General;
• suggests that Auto & General has a broader right to refuse claims or reduce the amount payable under claims if the policyholder does not meet the notification obligation than is available under the Insurance Contracts Act; and 
• could mislead or confuse the policyholder as to their true obligations and rights under the contract.   

½ñÈÕÈÈÃÅʼþis considering this decision. 

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Background

On 4 April 2023, ½ñÈÕÈÈÃÅʼþcommenced the Federal Court proceeding against Auto & General (23-088MR).  

The alleged unfair contract term appeared in the following product disclosure statements issued by Auto & General:   

• Auto & General Home and Contents Insurance Policy PDS  
• Budget Direct Your Home & Contents Insurance Policy PDS  
• Australia Post Your Home & Contents Insurance Policy PDS  
• ING Home & Contents Insurance Policy PDS  
• Catch Insurance Your Home & Contents Insurance Policy PDS  
• Virgin Insurance Your Home & Contents Insurance Policy PDS  
• Qantas Home and Contents Insurance Policy PDS.  

The Auto & General Home and Contents Insurance Policy PDS applies to 1st For Women, Best Buy, Maxxia, Ozicare and Retirease branded home and contents insurance policies issued by Auto & General. Auto & General no longer issues new home and contents policies for the Australia Post, Catch Insurance and Maxxia brands.  

On 4 May 2023, Auto & General issued Supplementary Product Disclosure Statements (SPDS) for its home and contents insurance products that, among other things, replaced the term that was the subject of this proceeding.   

On 21 September 2023, Auto & General issued new Product Disclosure Statements for its home and contents insurance products that contained the SPDS replacement term. 

On 19 April 2024, ½ñÈÕÈÈÃÅʼþappealed the Federal Court’s decision of the 22 March 2024 to dismiss ASIC’s proceeding against Auto & General regarding an alleged unfair contract term (24-079MR). The appeal was heard before the Full Federal Court on 28 August 2024.