The hawking prohibitions aim to prevent pressure selling of financial products to consumers and prevent certain marketing techniques that may detract from a consumers decision-making process.
Credit products will not be regulated under this new anti-hawking law; however, insurance products such as life (disability and injury) and general (home and contents).
These prohibitions state that a person must not
- offer a financial product for issue or sale to another person (a consumer) or
- request or invite another person to ask, apply or purchase a financial product
where the offer, request or invitation is made during, or because of, unsolicited contact with that person.
What does this mean?
- Insurance providers are prohibited from offering financial products to consumers during unsolicited meetings or phone calls.
- Insurance providers will now need the express consent of the customer prior to you referring them on.
- The consent is only valid for six weeks from the date it was given and may be withdrawn at any time by the consumer; and there is a statutory right for the consumer to return a product if they have been hawked that product.
What is unsolicited contact?
Unsolicited contact is any contact in relation to a financial product where the consumer did not consent, that is made by telephone, in face-to-face meetings or any other real-time interaction
Contact is not unsolicited if:
(a) the consumer’s consent is provided before the contact is initiated; and
(b) the subsequent offer in relation to a financial product is reasonably within the scope of the consumer’s consent
For a consumer to ‘consent’ to contact, they must make a positive, voluntary, and clear request to be contacted about the financial product.
How to gain consent?
Mercury Nexus makes it simple to gain consent and be compliant.
Find out how here: Mercury Nexus integration with Allianz
For more information on the Hawking Prohibitions refer to ASICs RG 38 click here