Sack them all, says ClearView insurance boss

ClearView’s chief risk officer called for employees to be sacked after lashing the workplace culture of his company.

Chief risk officer at ClearView Wealth, Gregory Martin leaves the banking royal commission in Melbourne. Picture: Aaron Francis

ClearView chief risk officer Greg Martin called for his employees to be sacked after lashing the ASX-listed life insurer’s “full-on sales culture without much regard for customers” and admitting it had breached criminal anti-hawking laws more than 300,000 times.

The royal commission heard that ClearView, which continues to be in the sights of the Australian Securities & Investments Commission over “systemic” failures in complying with laws designed to prevent spruikers forcing unwanted policies on customers, ran an outbound call centre where as much as 40 per cent of calls were non-compliant and targeted “poor” Australians with unnecessary policies.

Senior counsel assisting the commission, Rowena Orr QC, kicked off the inquiry’s probe into the life insurance sector yesterday by detailing a stream of admissions of misconduct from the largest companies in the industry, pinning a key driver of unethical behaviour on the $6 billion worth of commissions paid to financial advisers over the five years to last year.

Mr Martin, also chief actuary at the Sydney-based ClearView, was the first executive to be questioned at the royal commission’s fortnight of hearings.

He told the inquiry his company had breached anti-hawking laws in the Corporations Act up to 300,000 times for unsolicited and pestering sales of life insurance policies over a three-year period.

“This reflects a culture within ClearView Direct that was a full-on sales culture without much regard for customers,” he said.

“It’s just — yes — sack them,” he said.

The commission heard that after it took over the life insurance business from health insurer Bupa, ClearView used remuneration incentives of bonuses of up to $8000 a fortnight to drive sales staff to sell as many policies as possible, including through a plan to target poorer Australians. The strategy backfired, with large swaths of customers cancelling the Your Insure-branded policies sold to them or letting the insurance lapse.

“It was poorer people that were being targeted by Your Insure?” Ms Orr asked. Mr Martin responded: “I emphasise it was poorer, not poorest. You can’t build a business on that. It was not meant to go down to the lowest or particularly low (socio-economic customers, but) we were concerned that that may be where it was finding itself.”

Internal documents showed ClearView’s plan to pivot from selling “limited value” policies to low socio-economic segments to “top end” products for more affluent customers.

Mr Martin estimated the company’s breaches of the law at “10,000 or 12,000 times”, but letters and documents shown to the commission revealed ClearView found more than 300,000 instances where it couldn’t tell whether it was complying with the law.

Opposition financial services spokeswoman Clare O’Neil said following the revelations: “Some people targeted by this conduct included vulnerable, low-income Australians. It is an enormous, ­appalling breach and yet another example of sickening misconduct in the financial services sector.”