Up to 30,000 mortgage holders are set to challenge Aussie Home Loans for selling a junk policy
Shine Lawyers has filed a class action in Federal Court against Aussie Home Loans over mortgagees allegedly being sold junk insurance policies.
As per the claim, homeowners who acquired Mortgage Protection Plan or My Protection Plan policies through Aussie Home Loans were misled into buying a junk policy. The class action aims to determine whether the brokers who marketed these policies breached their duty to act in the best interests of their clients and if the sale of the insurance constituted misleading or deceptive conduct.
"The policy promised mortgage-holders assistance for home loan repayments in the event of illness or injury, loss of employment or death. We allege it was an unnecessary expense given most customers may have already held life-insurance policies that offered them this security and coverage, and/or because Aussie’s policy only provided cover in a limited range of circumstances", Shine Lawyers class actions practice leader Kione Johnson said.
Johnson pointed out that the scheme impacted first homebuyers in particular.
"First homebuyers are often the first to fall victim to redundant policies like this and it’s really disappointing to see large businesses taking advantage of young couples and families just trying to make their way. This is money that was better kept in their pockets", Johnson said. "The great Australian dream of owning a home has enough challenges without the banks making that pathway even more expensive and complicated".
Up to 30,000 mortgage holders will participate in the class action.
