Banking royal commission: Sales staff offered a Vespa, cruise in exchange for pushing funeral insurance

Sales staff who pushed insurance on thousands of Aboriginal customers were offered a scooter and cruise as a reward.

The director of Insurer Select AFSL Pty Ltd, Russell Howden, before giving evidence at the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry at the Supreme Court of the Northern Territory in Darwin. Picture: AAP

Sales staff at a Sydney-based company that sold Let’s Insure-­branded funeral insurance pushed plans on thousands of Aboriginal customers after a Vespa scooter and a Sunshine Coast cruise were offered as incentives, the royal commission heard.

Kathy Marika, a 60-year-old Arnhem Land woman, was offered shopping vouchers by Let’s Insure if she referred “as many people as you can” to the company, after telemarketers with thick British accents signed her and her seven children and grandchildren to funeral policies.

Ms Marika, a retired dancer with the Bangarra Dance Theatre who speaks English as a second language, was yesterday the second victim to give evidence at Darwin hearings of the royal commission, which this week focuses on the gouging of Aboriginal and Torres Strait Islander people, where thousands of children and babies have been signed up to funeral insurance policies under high-pressure sales tactics.

Ms Marika was targeted by five separate telemarketers from Let’s Insure to sign up to funeral insurance, despite telling the company she held life insurance and that she was happy with her current coverage.

“I told them that I didn’t want it. I told them that I already had one. He seemed to be really pushy,” Ms Marika said.

Insurance customer Kathy Marika. Picture: AAP

She then had trouble cancelling the policies, but after NSW Legal Aid intervened, Ms Marika was promised a full refund of almost $2000. She said she did not believe this had happened.

The royal commission heard that although only 2 per cent of customers who signed up for the company’s funeral-insurance policies were sold policies by telemarketers, almost 20 per cent of Aboriginal customers were sold policies by telemarketers.

A Bank of Queensland spokeswoman said Let’s Insure was operating under its own regulatory licences and the bank alerted the corporate regulator to the high rate of Aboriginal customers that were being signed up to policies.

The funeral-insurance plans were underwritten by former BOQ insurance arm St Andrews.

The royal commission also heard a separate funeral insurer, Aboriginal Community Benefit Fund, had been deducting money from the Centrepay benefits of about 6000 Aboriginal and Torres Strait Islander people despite not knowing where they were.

ACBF was forced to end its cover for those customers after it was blocked from deducting policy premiums from Centrepay before the welfare payments reached clients after it could not contact the customers to arrange a different payment method.

“You couldn’t find them even though you had been deducting payments from their Centrelink benefits?” counsel assisting, Rowena Orr, asked. “Yes,” ACBF chief executive Bryn Jones responded.

The royal commission heard yesterday that Mr Jones was appointed ACBF chief despite not having any qualifications.