QBE add-on insurance refunds
Are you owed a refund for consumer credit
or gap insurance?
QBE Insurance is refunding up to $16 million to over 36,000
customers who bought add-on insurance through car dealerships
across Australia. The refunds are being paid because QBE agreed
that customers were sold insurance that provided little or no
Here we explain who is entitled to a refund and how to contact
QBE if you have any questions about the refund process.
Am I entitled to a refund
You may be entitled to a refund if you bought QBE branded
Guaranteed Asset Protection (GAP) or Consumer Credit Insurance
(CCI) when you bought a car between 2011 and 2017.
If you bought a car between these dates, you should check if you
bought QBE GAP or CCI insurance.
QBE will be writing to all affected customers from 2 August
2017. If you don't receive a letter and you think you might be
eligible for a refund you can contact QBE:
What will my refund be?
All eligible customers who bought QBE GAP insurance will be
refunded at least a year's worth of GAP insurance premiums because
the 'new for old' cover included in their comprehensive car
insurance from any insurer would have provided similar cover as the
GAP insurance for at least the first year.
You may also be eligible for a further refund of your GAP
premium if you:
- paid a large deposit for your car (which means you were
unlikely to need GAP insurance)
- were sold more GAP cover than you needed
- paid off your loan early.
If you are under 25 and bought the QBE CCI insurance, you will
be offered a refund for the cost of the life and trauma element of
the insurance. This is because you are unlikely to have dependents
who would rely on the insurance to meet loan repayments if you died
or could no longer earn an income.
The average refund will be around $400 but could be as high as
$3,000. All refunds will include interest.
What if I disagree with QBE's refund offer?
If you are not happy with the refund offered by QBE, you can
call QBE's Customer Care Unit on 1300 650 503. If you are not happy
how they handle your complaint, you can ask for it to be escalated
to a QBE dispute resolution specialist. Visit qbe.com.au/complaints for
information on how to do this.
If QBE takes more than 45 days to respond to your complaint, or
if you're not happy with how it has been handled, you should
contact the Financial Ombudsman Service on 1800 367 287 or visit fos.org.au.
You can complain even if you accept QBE's refund.
What's add-on insurance?
There are many different types of add-on insurance policies that
might be sold to you when you buy a car at a car yard. These
- GAP insurance -
Covers the lender for the difference between what you owe on the
car loan, and what the car is insured for under comprehensive car
insurance, if you write your car off. You can also buy 'purchase
price gap insurance' that's not linked to a loan. This type of gap
insurance pays you the difference between what your comprehensive
car insurance pays out, and what you paid for the car.
insurance - Provides some cover if you can't meet
the repayments on your loan if you die, suffer a traumatic illness
(such as cancer), or become disabled or unemployed. If you need to
claim, the money will go to your lender, not you.
ASIC's review of add-on
These refunds are a direct result of ASIC's 2016 review of the sale of
add-on insurance through car dealers, which uncovered the
wide-spread sale of insurance with little or no value to
What were ASIC's concerns about QBE?
ASIC was concerned that QBE's CCI add-on insurance was sold to
young people who had no dependents and were unlikely to need the
ASIC was also concerned that QBE's GAP insurance was sold to
customers who did not need it because:
- there was no gap to cover, for example because they paid a
large deposit, or
- customers already had similar insurance cover, or
- customers were sold more insurance than they needed.
To find out more, see ASIC's media release.
Before you get add-on insurance with your car
loan, make sure you'll benefit from the insurance or don't already
have similar cover from your comprehensive car insurance. If you do
decide to get add-on insurance, consider paying for it up-front
instead of adding it to the cost to your loan.
Last updated: 02 Aug 2017