ASIC Sues RACQ Insurance for Misleading Premium Comparisons

Regulator Claims Deceptive Pricing Affected Hundreds of Thousands of Policyholders

ASIC Initiates Legal Action Against RACQ Insurance Over Misleading Premium Practices?w=400

The Australian Securities and Investments Commission (ASIC) has commenced Federal Court proceedings against RACQ Insurance, a subsidiary of Insurance Australia Group (IAG), alleging that the insurer misled over 570,000 customers through deceptive premium comparison pricing in renewal notices issued between September 2019 and December 2024.

According to ASIC, RACQ Insurance included inflated 'last period premium' figures in their renewal notices, leading customers to believe that their premiums had increased less than they actually had. This practice potentially resulted in customers overpaying for their insurance policies. The misleading information affected various types of insurance, including home, car, caravan, boat, and pet insurance.

Despite receiving customer complaints shortly after implementing this practice, RACQ Insurance allegedly continued the misleading pricing for several years. ASIC is seeking civil penalties, declarations, and public orders to address these alleged breaches.

RACQ Insurance has acknowledged the proceedings and stated that it is cooperating with ASIC while conducting its own internal review. The company self-reported the issue in 2024 following media inquiries.

This case underscores the importance of transparency and accuracy in insurance communications. Policyholders are advised to carefully review renewal notices and seek clarification on any discrepancies to ensure they are not overpaying for coverage.

Published:Thursday, 23rd Oct 2025
Source: Paige Estritori

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Subrogation:
An insurance carrier may reserve the "right of subrogation" in the event of a loss. This means that the company may choose to take action to recover the amount of a claim paid to a covered insured if the loss was caused by a third party.