As well as a relatively modest bill of $14,000 to refund 102 affected customers, the insurer will contribute $150,000 to the Financial Rights Legal Centre’s Insurance Law Service, which provides free advice to consumers specifically about problems with insurance products.
The move comes after regulator Australian Securities and Investments Commission (ASIC) flagged concerns about its sales practices used for selling home and car insurance policies.
In addition to the monetary costs, Youi has also committed to engage an independent review of its sales practices.
Those practices include allegations that Youi sales personnel charged consumers for policies without their consent when they had only an inquiry or attempted to receive a quote.
In a statement, ASIC said it “was concerned that Youi’s remuneration and bonus structures incentivised sales staff to prioritise sales ahead of consumers’ interests”.
“It is completely unacceptable that customers were signed up for Youi insurance policies without their knowledge or permission,” said acting ASIC chair Peter Kell.
According to ASIC, Youi has since undertaken a number of changes to avoid a repeat of the situation, including changing its staff remunerations and incentives structures as well as introducing new controls and monitoring of sales staff.