Source: Radio New Zealand
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A global insurance giant has been warned by the Financial Markets Authority for failing to apply multi-policy discounts in New Zealand.
The FMA said Aioi Nissay Dowa Insurance’s (AIOI) failure led to more than 5000 customers being overcharged almost $700,000.
The company self-reported the issue in May 2024, and the policies affected were sold through various car dealerships and online.
“Manual processes used to identify customers with more than one policy failed and customers eligible for discounts were not identified,” FMA executive director of response and enforcement Louise Unger said.
“We expect financial institutions to invest in quality systems and controls that enable them to deliver on advertised promises and to also identify issues and be capable of resolving those issues effectively and quickly.”
Unger said customers “should rightly expect” that promises would be honoured.
“In this case, AIOI acted responsibly in notifying FMA at its earliest opportunity, self-reporting the matter three days after it became aware of the issue.”
The FMA said AIOI took proactive steps to identify all affected policyholders, notify them and make remediation payments.
The company also took steps to prevent a repeat of the issue.
Over the past year, major insurers have stopped offering multi-policy discounts amid regulatory action.
In December 2025, Tower insurance was penalised $7 million for more than a decade of overcharging customers as it did not properly apply multi-policy discounts.
IAG was penalised a record $19.5m in October last year for overcharging nearly 240,000 customers by not giving them promised discounts and benefits.
AA Insurance was ordered to pay $6.2m in 2024 for failing to apply multi-policy and membership discounts, as well as guaranteed no-claims bonuses.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
