Duty to take reasonable care not to make a misrepresentation to an insurer

12 days left to have your say
Consultation Type
Exposure Draft

Key Documents

The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry made a number of recommendations regarding the rights and obligations of consumers purchasing insurance policies.

On 4 February 2019, the Government released its response to the Royal Commission, and is taking action on all 76 recommendations.

The Government is today releasing exposure draft legislation for public comment which implements recommendation 4.5 of the Royal Commission. 

Recommendation 4.5 implements a duty to take reasonable care not to make a misrepresentation to an insurer for consumer insurance contracts. The changes ensure that obligations for disclosure applied to consumers do not enable insurers to unduly reject the payment of legitimate claims.

This duty will replace the existing duty of disclosure contained in Part IV of the Insurance Contracts Act 1984. The duty of disclosure is important to ensure that insurers are able to appropriately price the risks being underwritten through limiting the risk of fraud and misleading disclosures. However, the current requirements fall short of adequately safeguarding consumers against having their claims declined where they may have inadvertently failed to disclose their past circumstances or because insurers have failed to ask the right questions.


You can submit responses to this consultation up until 28 February 2020. Interested parties are invited to comment on this consultation. You may make one submission across open consultations. In doing so, please make clear which measures your submission relates to. 

While submissions may be lodged electronically or by post, electronic lodgement is preferred. For accessibility reasons, please submit responses sent via email in a Word or RTF format. An additional PDF version may also be submitted.

All information (including name and address details) contained in submissions will be made available to the public on the Treasury website unless you indicate that you would like all or part of your submission to remain in confidence. All submissions (whether or not made public) will also be provided to ASIC and/or APRA unless you otherwise indicate. Automatically generated confidentiality statements in emails do not suffice for this purpose. Respondents who would like part of their submission to remain in confidence should provide this information marked as such in a separate attachment.

Legal requirements, such as those imposed by the Freedom of Information Act 1982, may affect the confidentiality of your submission.

View our submission guidelines for further information.

How To Respond




Address written submissions to:

Senior Adviser
Financial System Division
Langton Cres
Parkes ACT 2600


Email: FSRCconsultations@treasury.gov.au
Phone: Luke Spear +61 2 6263 2111