On 18 December 2017, the Government announced that it would extend the unfair contract term provisions to contracts of insurance. The Government is now seeking stakeholder views on a proposed model to implement this policy.
The proposed model seeks to ensure that consumers and small businesses that purchase insurance have the same access to protection from unfair terms in insurance contracts as they do for other contracts for financial products and services.
This proposed model involves amending the Insurance Contracts Act 1984 (IC Act) to allow the UCT laws in the Australian Securities and Investments Commission Act 2001 (ASIC Act) to apply to insurance contracts regulated by the IC Act.
In addition, it is proposed that the UCT laws in the ASIC Act will be tailored to accommodate specific features of insurance contracts.