CBA Junk Insurance class action
What is the cba junk insurance class action?
In June 2020, law firm Slater and Gordon commenced legal proceedings against CBA and its insurer, Colonial Mutual Life Assurance Society Limited (Colonial) for selling “junk” consumer credit insurance policies (also known as CCI).
If you paid for insurance on a current or former CBA credit card or personal loan, you could be eligible to participate in the Class Action and get your premiums back.
The products in question are called:
CBA CreditCard Plus and
CBA Personal Loan Protection
The class action alleges that CBA and its insurers:
Caused customers to make payments as a result of a mistaken belief their policy was compulsory or provided value to them
Engaged in misleading or deceptive conduct in relation to the sale of the policies to customers
Engaged in unconscionable conduct in relation to the sale and issue of the policies to customers by, among other things, selling or issuing policies with no or little value
Unlawfully provided personal advice to some customers who purchased the policies in a bank branch or over the telephone
Class actions in Australia use an ‘opt-out’ model, which means you might automatically be joined up to this class action if, at any time since 1 January 2010, you were:
Issued with a CBA CreditCard Plus or Personal Loan Protection policy;
Have paid a premium; and
Have not been remediated in full for the loss you suffered as a result of the Respondents’ conduct.
If that’s you, you should have received an ‘Opt Out and Commencement Notice’ informing you that you were part of the class action.
The date to opt out of this particular class action has now passed, BUT it might still be possible to opt out and chase a bigger, faster refund. Read on.
What should I do if i'm a current or former cba customer?
If you want a refund on Junk Insurance premiums you might have paid to CBA, you’ve got three options:
1. Contact the bank yourself and ask them for copies of your old statements,
2. Seek a refund via the class action (more on this below), or
3. Ask a service such as Remediator to try and get you a better refund.
PROS & CONS:
diy vs class actions vs remediation services
If you decide to do it yourself, you’ll need to comb over your old statements for evidence of insurance premiums being deducted.
You can request these statements by contacting CBA.
Some of us will feel confident to do this. But DIY can also be time consuming and difficult, so if you want some more firepower in your corner, consider asking the experts to take up your fight for you.
There are two ways to do that, which we explain in more detail below.
If you do nothing, you might be taking this option by default.
In Australia, the plaintiff in a class action does not require the consent of class members to commence a class action on their behalf, nor do they need to identify individual class members.
This is known as an ‘open’ class action system and is different to the system in other countries with a ‘closed’ system which require class members to actively ‘sign up’.
If you’re part of the class action and you decide to remain, you’ll be bound by the result and you lose your ability to claim direct from the bank or via services such as Remediator.
But ‘opting out’ can sometimes result in a bigger, quicker refund.
The CBA Class Action is being run on a no win, no fee basis. That means that if successful, the court will probably approve for the law firm to deduct reasonable legal costs from any settlement or judgement obtained.
But legal fees and the fees paid to litigation funders on class actions can sometimes really add up. A recent Parliamentary Enquiry concluded that:
“When they finally get their day in court, it is the genuinely wronged class action members who are getting the raw deal of significantly diminished compensation for their loss, as bigger and bigger cuts are awarded to generously paid lawyers and funders.”
An academic submission to the same enquiry found that over the past 20 years, legal fees on class actions averaged 15% and when litigation funders were involved it rose to approximately 40%.
Opting out usually requires a prescribed form to be completed and lodged within a set period of time. This can vary between class actions and jurisdictions. Before opting out, the class member should check they can prove the elements of their claim and that the claim is still ‘within time’.
While the CBA opt out date has passed, in some cases, we’ve found they will allow you to opt out AFTER the closing date. So even if you think it’s too late, Remediator can make enquiries for you.
morrissey law & advisory says:
“That convenience should be weighed against the time that that it usually takes to resolve a class action, which can be slow‐moving, and sometimes not reach settlement or determination for several years.”
“Considerations should include:
The scale of class actions - class members may be unlikely to receive more than ‘cents on the dollar’ for their claim.
Loss of control over a class member’s own claim - particularly if litigation funders are involved and are responsible for instructing the class’ legal representation.”
CLICK HERE to read Morrissey Law & Advisory’s full guide to class actions.
We believe services such as Remediator are the ideal compromise for anyone who wants to maximise their refund without doing all the work themselves.
If you’re already joined to the CBA Class Action: we can inquire whether it’s possible for you to opt out, even though the deadline has passed.
If you’re not joined to the CBA Class Action: you’re free to use Remediator to try and maximise your refund.
With services such as Remediator, you know what percentage of the refund you’re getting back and you can be confident we will try to maximise your refund and minimise the waiting time.
Some remediation services charge 30% of your refund for the work they do. Remediator only charges 20% while doing all the legwork for you, from contacting your bank to combing through your old statements to chasing up your refund and fighting your corner if the going gets tough. If there’s no refund, there’s no fee.
But the proof is in the pudding: decide for yourself!
Average Remediator refund so far: $2,179
Average time from eligibility check to refund: 38 days
This article does not provide legal or financial advice. Any information in this article is designed to provide information to consumers who want to learn more about class actions and other ways to seek refunds. All information is general in nature.
ClaimFast Pty Ltd trading as Remediator is not liable for any loss caused, whether due to negligence or otherwise arising from use of, or reliance on, the information provided directly or indirectly, by use of this service. Consider whether the service is right for you. If you are unsure how to proceed, you should seek independent legal advice.