This article focuses on the recently passed legislation by the Financial Services Royal Commission and what has changed from previous policies. The specific legislation is the Financial Sector Reform (Hayne Royal Commission Response) Bill 2020.
It narrows the right of an insurer to avoid a life insurance policy on the basis of non-fraudulent misrepresentation or non-disclosure. Additionally, the Bill amends the insured’s existing duty of disclosure to create a duty to take reasonable care not to make a misrepresentation to the insurer before entering into a “Consumer insurance contract” (CIC).
Authors: Mandy Tsang, Special Counsel, and Sarah Yu, Partner, King & Wood Mallesons
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