Our investigation

We examined the wording of Tawera’s insurance policy, and it was clear the insurer was responsible for insuring Tawera, assessing any claim, and providing services such as the 24-hour emergency line. The bank was not liable for the insurer's performance of any of these services.

Tawera said it was misleading for the bank to use the insurance policy to sell its credit cards, but then deny liability for the insurer's actions or inaction. We did not agree. Tawera’s policy wording clearly and repeatedly stated that the bank was not liable for the performance of the insurance contract, and this information was explicitly set out on the bank's website as well.

We did not think it was unfair or unreasonable for the bank to refuse liability for the insurance policy either. If something went wrong with the insurance cover, Tawera had recourse against the insurer. The insurer had its own internal complaints process and was a member of another dispute resolution scheme. This complaints process had proved effective, and his complaint had been settled. There was noreason for the bank to share this liability.

Nonetheless, we found there were faults in the way the bank had handled Tawera’s complaint. Shortly after filing his insurance claim, Tawera emailed the bank to express his dissatisfaction with the way the insurer was handling the claim. He also asked the bank to step in. The bank directed his complaint to its internal complaints process, but there were several substantial and unwarranted delays during the process. We were satisfied these deficiencies had caused Tawera some inconvenience and frustration, and we recommended the bank pay him $400 compensation.

Outcome

The bank offered Tawera $400, but he did not accept it, instead saying he intended pursuing his complaint through the courts.