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Monday, 25 June 2018
Page: 136


Ms HENDERSON (Corangamite) (16:41): I am very pleased that the treatment of Wye River bushfire victims insured with AAMI insurance, owned by Suncorp, has been selected as a case study to be examined by the Hayne royal commission. This was a devastating bushfire which claimed 116 homes in Wye River and Separation Creek. It is a miracle that no lives were lost. These homes were covered by a complete replacement cover insurance policy. AAMI guaranteed that any home destroyed would be rebuilt no matter the cost, alleviating the risk of a policyholder being underinsured, but AAMI failed to provide sufficient funds to rebuild the homes destroyed in the 2015 Christmas Day bushfire, undercutting the cost of a rebuild by as much as half a million dollars per home. The policy was fundamentally flawed, and I believe that AAMI deliberately short-changed homeowners, which was unjust and heartbreaking.

I'm very pleased that this case will be brought before the royal commission. I am disappointed that when this case was referred to ASIC by the Minister for Revenue and Financial Services, after I spoke out very strongly, ASIC did not appropriately investigate and make proper recommendations. ASIC's conduct was very disappointing. It is incumbent upon ASIC to take the strongest possible action as soon as possible, including speaking out in order to ensure insurance companies treat customers properly.