Insurance Contracts Act 1984 (Cth)

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Insurance Contracts Act 1984

No. 80, 1984

Compilation No. 32

Compilation date: 1 March 2024

Includes amendments:Act No. 76, 2023

Registered: 1 March 2024

About this compilation

This compilation

This is a compilation of the Insurance Contracts Act 1984 that shows the text of the law as amended and in force on 1 March 2024 (the compilation date).

The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.

Uncommenced amendments

The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Register ( The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the Register for the compiled law.

Application, saving and transitional provisions for provisions and amendments

If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.

Editorial changes

For more information about any editorial changes made in this compilation, see the endnotes.

Modifications

If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the Register for the compiled law.

Self‑repealing provisions

If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.

      

Contents

An Act to reform and modernise the law relating to certain contracts of insurance so that a fair balance is struck between the interests of insurers, insureds and other members of the public and so that the provisions included in such contracts, and the practices of insurers in relation to such contracts, operate fairly, and for related purposes

Part IPreliminary  1Short title

 This Act may be cited as the Insurance Contracts Act 1984.

2Commencement

 This Act shall come into operation on a day to be fixed by Proclamation.

3Repeals
  • (1)

    The Imperial Acts known as The Life Assurance Act, 1774, The Fires Prevention (Metropolis) Act, 1774 and The Marine Insurance Act, 1788, in their application to a contract of insurance or proposed contract of insurance to or in relation to which this Act applies, are repealed in so far as they are part of the law of the Commonwealth or of an external Territory to which this Act extends.

  • (2)

    Section 8 of the Acts Interpretation Act 1901 extends to those Imperial Acts as so repealed as though they were Acts of the Parliament repealed by this Act.

4Previous contracts
  • (1)

    Subject to subsection (2), this Act does not apply to or in relation to a contract of insurance that was entered into before the date of commencement of this Act.

  • (2)

    The application of sections 32, 54 and 56 extends to and in relation to a superannuation contract (other than an individual superannuation contract) that was entered into before the date of commencement of this Act in so far as a person who becomes, on or after that date, a member of the relevant superannuation or retirement scheme is concerned.

5Crown to be bound
  • (1)

    This Act binds the Crown in right of the Commonwealth or of a Territory in which this Act applies or to which this Act extends but does not bind the Crown in right of a State.

  • (2)

    Nothing in this Act renders the Crown in right of the Commonwealth or of a Territory liable to be prosecuted for an offence arising under this Act.

6Extension to external Territories
  • (1)

    This Act extends to Norfolk Island, the Territory of Christmas Island and the Territory of Cocos (Keeling) Islands, and to any other external Territory that is for the time being declared by Proclamation to be a Territory to which this Act extends.

  • (2)

    A reference in this Act to the date of commencement of this Act is, in relation to an external Territory to which this Act extends, a reference to that date or to the date on which this Act commences so to extend, whichever is the later.

7Effect of Act on other laws

 It is the intention of the Parliament that this Act is not, except in so far as this Act, either expressly or by necessary intendment, otherwise provides, to affect the operation of any other law of the Commonwealth, the operation of law of a State or Territory or the operation of any principle or rule of the common law (including the law merchant) or of equity.

8Application of Act
  • (1)

    Subject to section 9, the application of this Act extends to contracts of insurance and proposed contracts of insurance the proper law of which is or would be the law of a State or the law of a Territory in which this Act applies or to which this Act extends.

  • (2)

    For the purposes of subsection (1), where the proper law of a contract or proposed contract would, but for an express provision to the contrary included or to be included in the contract or in some other contract, be the law of a State or of a Territory in which this Act applies or to which this Act extends, then, notwithstanding that provision, the proper law of the contract is the law of that State or Territory.

9Exceptions to application of Act
  • (1)

    Except as otherwise provided by this Act, this Act does not apply to or in relation to contracts and proposed contracts:

    • (a)

      of reinsurance; or

    • (b)

      of insurance entered into, or proposed to be entered into, by a private health insurer within the meaning of the Private Health Insurance Act 2007 in respect of its health insurance business within the meaning of Division 121 of that Act; or

    • (ba)

      of insurance entered into, or proposed to be entered into, by a private health insurer within the meaning of the Private Health Insurance Act 2007 in respect of its health‑related business within the meaning of section 131‑15 of that Act that is conducted through a health benefits fund (as defined by section 131‑10 of that Act); or

    • (c)

      of insurance entered into, or proposed to be entered into, by a friendly society; or

    • (ca)

      of insurance entered into, or proposed to be entered into, by the Export Finance and Insurance Corporation, other than short‑term insurance contracts within the meaning of the Export Finance and Insurance Corporation Act 1991 that are entered into on or after the commencement of this paragraph; or

    • (d)

      to or in relation to which the Marine Insurance Act 1909 applies; or

    • (e)

      entered into or proposed to be entered into for the purposes of a law (including a law of a State or Territory) that relates to:

      • (i)

        workers’ compensation; or

      • (ii)

        compensation for the death of a person, or for injury to a person, arising out of the use of a motor vehicle; or

    • (f)

      entered into or proposed to be entered into:

      • (i)

        for the purposes of a law (including a law of a State or a Territory) that relates to workers’ compensation; and

      • (ii)

        to provide insurance cover in respect of an employer’s liability under a rule of the common law that requires payment of damages to a person for employment‑related personal injury.

  • (1A)

    If a contract of insurance, or a proposed contract of insurance, includes:

    • (a)

      provisions (the first group of provisions) that would, if they comprised a single contract or proposed contract, form a contract referred to in any of paragraphs (1)(a) to (f); and

    • (b)

      provisions (the second group of provisions) that would, if they comprised a single contract or proposed contract, form a contract other than a contract referred to in any of paragraphs (1)(a) to (f);

    then subsection (1) applies as if the first group of provisions and the second group of provisions were each a separate contract or proposed contract.

  • (1B)

    Despite subsection (1A), if a contract of insurance, or a proposed contract of insurance, includes:

    • (a)

      provisions (the first group of provisions) for the purposes of a law referred to in subparagraph (1)(f)(i); and

    • (b)

      provisions (the second group of provisions) that provide insurance cover of the kind referred to in subparagraph (1)(f)(ii);

    then subsection (1) applies as if the first group of provisions and the second group of provisions were together a separate contract or proposed contract.

  • (1C)

    If:

    • (a)

      a provision (a related provision) of a contract of insurance, or a proposed contract of insurance, relates to or affects the operation of a group or groups of provisions included in the contract or proposed contract; and

    • (b)

      because of subsection (1A) or (1B), subsection (1) applies as if that group or those groups of provisions were a separate contract or proposed contract;

    then the related provision is, for the purposes of subsection (1), to be regarded as a provision included in that separate contract or proposed contract.

  • (2)

    This Act does not apply to or in relation to contracts and proposed contracts of insurance entered into, or proposed to be entered into, in the course of State insurance or Northern Territory insurance, including contracts and proposed contracts entered into, or proposed to be entered into, by:

    • (a)

      a State or the Northern Territory; and

    • (b)

      some other insurer;

    as joint insurers.

  • (3)

    Sections 37, 41, 58, 59, 60, 63, 69 and 74 do not apply in relation to contracts, and proposed contracts, of insurance against the risk of the loss of an aircraft, or damage to the hull of an aircraft, as a result of war.

  • (4)

    Sections 53 and 63 do not apply in relation to a provision of a contract, or a proposed contract, of insurance to the extent that:

    • (a)

      the provision authorises or permits the insurer to vary or cancel either or both of the following:

      • (i)

        cover for risks related to war;

      • (ii)

        cover for risks related to terrorism; and

    • (b)

      the provision is prescribed or otherwise identified by the regulations.

9AExclusion of pleasure craft from the Marine Insurance Act 1909
  • (1)

    The Marine Insurance Act 1909 does not apply to a contract of marine insurance made in respect of a pleasure craft unless the contract is made in connection with the pleasure craft’s capacity as cargo.

  • (2)

    For the purposes of this section, a pleasure craft is a ship that is:

    • (a)

      used or intended to be used:

      • (i)

        wholly for recreational activities, sporting activities, or both; and

      • (ii)

        otherwise than for reward; and

    • (b)

      legally and beneficially owned by one or more individuals; and

    • (c)

      not declared by the regulations to be exempt from this subsection.

  • (3)

    For the purposes of paragraph (2)(a), any minor, infrequent and irregular use of a ship for activities other than:

    • (a)

      recreational activities; or

    • (b)

      sporting activities;

    is to be ignored.

  • (4)

    In this section:

    contract of marine insurance has the same meaning as in the Marine Insurance Act 1909.

10Contracts of insurance
  • (1)

    A reference in this Act to a contract of insurance includes a reference to a contract that would ordinarily be regarded as a contract of insurance although some of its provisions are not by way of insurance.

  • (2)

    A reference in this Act to a contract of insurance includes a reference to a contract that includes provisions of insurance in so far as those provisions are concerned, although the contract would not ordinarily be regarded as a contract of insurance.

  • (3)

    Where a provision included in a contract that would not ordinarily be regarded as a contract of insurance affects the operation of a contract of insurance to which this Act applies, that provision shall, for the purposes of this Act, be regarded as a provision included in the contract of insurance.

11Interpretation
  • (1)

    In this Act, unless the contrary intention appears:

    annual turnover, of a body corporate during a 12‑month period, means the sum of the values of all the supplies that the body corporate, and any body corporate related to the body corporate, have made, or are likely to make, during the 12‑month period, other than:

    • (a)

      supplies made from any of those bodies corporate to any other of those bodies corporate; or

    • (b)

      supplies that are input taxed; or

    • (c)

      supplies that are not for consideration (and are not taxable supplies under section 72‑5 of the A New Tax System (Goods and Services Tax) Act 1999); or

    • (d)

      supplies that are not made in connection with an enterprise that the body corporate carries on; or

    • (e)

      supplies that are not connected with Australia.

    Expressions used in this definition that are also used in the A New Tax System (Goods and Services Tax) Act 1999 have the same meaning as in that Act.

    ASIC means the Australian Securities and Investments Commission.

    avoid, in relation to a contract of insurance, means avoid from its inception.

    benefit derived and detriment avoided because of an offence has the meaning given by section 75F.

    binder means an authority given by an insurer to an insurance intermediary to enter into, as agent for the insurer, contracts of insurance on behalf of the insurer as insurer.

    broker’s placing slip means a document that:

    • (a)

      is evidence of a contract of insurance; and

    • (b)

      bears a notation by an insurer setting out the extent of the insurance cover that the insurer agrees to provide under the contract.

    business day means a day that is not a Saturday, a Sunday or a public holiday or bank holiday.

    civil penalty provision: a subsection of this Act (or a section of this Act that is not divided into subsections) is a civil penalty provision if:

    • (a)

      the words “civil penalty” and one or more amounts in penalty units are set out at the foot of the subsection (or section); or

    • (b)

      another provision of this Act specifies that the subsection (or section) is a civil penalty provision.

    consumer credit insurance means insurance provided by a class of contracts of insurance:

    • (a)

      that is declared by the regulations to be a class of contracts to which Division 1 of Part V of this Act applies; and

    • (b)

      that is identified by those regulations as consumer credit insurance.

    consumer insurance contract has the meaning given by section 11AB.

    continuous disability insurance policy means a contract that is a continuous disability policy within the meaning of the Life Insurance Act 1995.

    contract of life insurance means a contract that constitutes a life policy within the meaning of the Life Insurance Act 1995.

    contravention:

    • (a)

      in relation to an offence against a law—includes an ancillary offence relating to the offence against the law; and

    • (b)

      in relation to a civil penalty provision—has a meaning affected by section 75Q.

    duty of disclosure means the duty referred to in section 21.

    duty of the utmost good faith means the duty referred to in subsection 13(1).

    duty to take reasonable care not to make a misrepresentation means the duty referred to in section 20B.

    engage in conduct means:

    • (a)

      do an act; or

    • (b)

      omit to perform an act.

    friendly society means:

    • (a)

      a body that is a friendly society for the purposes of the Life Insurance Act 1995; or

    • (b)

      a body that is registered or incorporated as a friendly society under a law of a State or Territory; or

    • (c)

      a body that is permitted, by a law of a State or Territory, to assume or use the expression friendly society; or

    • (d)

      a body that, immediately before the date that is the transfer date for the purposes of the Financial Sector Reform (Amendments and Transitional Provisions) Act (No. 1) 1999, was registered or incorporated as a friendly society under a law of a State or Territory.

    group life contract means a contract of life insurance that is maintained for the purposes of:

    • (a)

      a superannuation or retirement scheme under which there can be more than one life insured; or

    • (b)

      another kind of group life scheme (including a scheme that is not related to employment) under which there can be more than one life insured.

    guardian, in relation to a person who has not attained the age of 18 years, means a person who acts in the place of a parent of the person but does not include a person who so acts only for limited or particular purposes or periods.

    holder has the same meaning as in the Retirement Savings Accounts Act 1997.

    infringement notice means a notice given under section 75W.

    insurance broker means a person who carries on the business of arranging contracts of insurance, whether in Australia or elsewhere, as agent for intending insureds.

    insurance intermediary means a person who:

    • (a)

      for reward; and

    • (b)

      as an agent for one or more insurers or as an agent for intending insureds;

    arranges contracts of insurance in Australia or elsewhere, and includes an insurance broker.

    insured and insurer include a proposed insured and a proposed insurer, respectively.

    involved, in relation to a contravention, has the same meaning as in the Corporations Act 2001.

    life insured includes a proposed life insured.

    payment period, in relation to an infringement notice, has the meaning given by section 75Z.

    pecuniary penalty order has the meaning given by subsection 75B(4).

    policy document, in relation to a contract of insurance, means:

    • (a)

      a document prepared by the insurer as evidence of the contract; or

    • (b)

      a broker’s placing slip that constitutes evidence of the contract;

    and includes, in relation to an interim contract of insurance, a document of the kind usually known as a cover note prepared by the insurer or by an insurance intermediary with the authority of the insurer.

    proposal form includes:

    • (a)

      a document containing questions to which a person is asked to give answers (whether in the document or not), where the answers are intended (whether by the person who answered them, by the insurer or by some other person) to be used in connection with a proposed contract of insurance; and

    • (b)

      a form relating to the proposed membership of a person of a superannuation, retirement or other group life scheme.

    relevant court means:

    • (a)

      the Federal Court of Australia; or

    • (b)

      the Federal Circuit and Family Court of Australia (Division 2); or

    • (c)

      the Supreme Court of a State or Territory.

    relevant failure, in relation to a contract of insurance, has the meaning given by section 27AA.

    RSA has the same meaning as in the Retirement Savings Accounts Act 1997.

    RSA provider has the same meaning as in the Retirement Savings Accounts Act 1997.

    subject to an infringement notice, in relation to an offence provision or civil penalty provision, has the meaning given by section 75X.

    third party beneficiary, under a contract of insurance, means a person who is not a party to the contract but is specified or referred to in the contract, whether by name or otherwise, as a person to whom the benefit of the insurance cover provided by the contract extends.

    this Act includes the regulations.

    writing means writing in the English language or in another language agreed between the insurer and the insured.

  • (2)

    For the purposes of this Act, an interim contract of insurance is a contract of insurance that is intended by the insurer:

    • (a)

      to provide temporary insurance cover; and

    • (b)

      to be replaced or superseded by another contract of insurance;

    whether or not the contract is evidenced by a document of the kind usually known as a cover note.

  • (4)

    For the purposes of this Act:

    • (a)

      a superannuation contract is a contract of life insurance that is being maintained for the purposes of a superannuation or retirement scheme, where the insured is a trustee for the purposes of the scheme; and

    • (b)

      an individual superannuation contract is a superannuation contract as referred to in paragraph (a) under which there can be one life insured only.

  • (6)

    For the purposes of this Act, a contract of general insurance is a contract of insurance that is not a contract of life insurance.

  • (7)

    For the purposes of this Act, a contract of liability insurance is a contract of general insurance that provides insurance cover in respect of the insured’s liability for loss or damage caused to a person who is not the insured.

  • (8)

    For the purposes of this Act, an instalment contract of general insurance is a contract of general insurance the premium for which is, by virtue of a provision of the contract, payable by 7 or more instalments in a year.

  • (9)

    Subject to subsection (10), a reference in this Act to the entering into of a contract of insurance includes a reference to:

    • (a)

      in the case of a contract of life insurance—the making of an agreement by the parties to the contract to extend or vary the contract;

    • (b)

      in the case of any other contract of insurance—the making of an agreement by the parties to the contract to renew, extend or vary the contract; or

    • (c)

      the reinstatement of any previous contract of insurance.

  • (10)

    Notwithstanding subsection (9):

    • (a)

      subject to paragraph (c), where, after the commencement of this Act and at or before the original entering into, or the renewal, extension or reinstatement, of a contract of insurance, the insurer has given information to the insured as required by section 22, 35, 37, 37C, 40, 44, 49 or 68, the requirement by that section to give information to the insured shall be deemed to be satisfied at or before any subsequent renewal, extension or reinstatement of the contract;

    • (b)

      sections 22 and 40 do not require an insurer to give information to the insured at or before a variation of the relevant contract of insurance, unless subsection (10A) applies to the variation; and

    • (c)

      sections 35, 37, 37C, 44, 49 and 68 require an insurer to give information to the insured at or before a variation of the relevant contract of insurance, but only to the extent that the information relates to the provision or provisions varied or proposed to be varied.

  • (10A)

    This subsection applies to a variation of a contract of insurance if:

    • (a)

      the variation:

      • (i)

        is involved in a renewal, extension or reinstatement of the contract; or

      • (ii)

        will provide a kind of insurance cover that was not provided by the contract immediately before the variation; or

      • (iii)

        in the case of a contract of life insurance—will increase a sum insured under the contract in respect of one or more of the life insureds; and

    • (b)

      the variation is not an automatic variation but is required to be expressly agreed between the insurer and the insured before the contract is varied.

  • (11)

    Where a provision of this Act requires anything to be done before a particular contract is entered into, it is sufficient compliance with that provision if that thing is done at the time when the contract is entered into.

11AAApplication of the Criminal Code

Chapter 2 of the Criminal Code applies to all offences against this Act.

Note: Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

11ABConsumer insurance contracts
  • (1)

    For the purposes of this Act, a contract of insurance is a consumer insurance contract if the insurance is obtained wholly or predominantly for the personal, domestic or household purposes of the insured.

  • (2)

    A contract of insurance is also a consumer insurance contract if:

    • (a)

      it is for new business; and

    • (b)

      the insurer, before the contract is entered into, gives the insured a written notice stating that the contract is a consumer insurance contract.

  • (3)

    If it is alleged in a proceeding in relation to a contract of insurance that the contract is a consumer insurance contract, it is presumed that the contract is a consumer insurance contract unless the contrary is established.

Part IAAdministration  11AAADefinition

 In this Part, unless the contrary intention appears:

relevant legislation means:

  • (a)

    this Act; or

  • (b)

    Part 3 of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003.

11AASIC responsible for general administration of Act

Subject to any directions of the Minister, ASIC has the general administration of this Act.

11BPowers of the ASIC

For the purpose of undertaking the general administration of the relevant legislation, ASIC has power to do all things that are necessary or convenient to be done in connection with the administration of the relevant legislation and, without limiting the generality of that power, has power:

  • (a)

    to promote the development of facilities for handling inquiries in relation to insurance matters; and

  • (b)

    to monitor complaints in relation to insurance matters; and

  • (c)

    to liaise generally with other persons or bodies having a responsibility to deal with inquiries, complaints and disputes concerning insurance matters; and

  • (d)

    to review documents (including documents promoting particular kinds of insurance cover) issued by insurers and given to ASIC in compliance with section 11C; and

  • (e)

    to review particulars, statistics and documents given to ASIC in compliance with section 11D; and

  • (f)

    to monitor legal judgments, industry trends and the development of community expectations that are, or are likely to be, of relevance to the efficient operation of the relevant legislation; and

  • (g)

    to promote the education of the insurance industry, the legal profession and consumers as to the objectives and requirements of the relevant legislation.

11CSupervisory powers – ASIC may obtain insurance documents
  • (1)

    ASIC may, for any purpose connected with the general administration of the relevant legislation, by notice in writing given to an insurer, require the insurer to give to ASIC, within 30 days of receipt of the notice, or such longer period as is specified in the notice, copies of:

    • (a)

      documents specified in the notice relating to insurance cover provided, or proposed to be provided, by the insurer; or

    • (b)

      documents relating to insurance cover of a kind specified in the notice provided, or proposed to be provided, by the insurer.

  • (2)

    An insurer must not fail, without reasonable excuse, to comply with the requirements of a notice under subsection (1).

    Penalty: 150 penalty units.

    Note: For the liability of a director, employee or agent of an insurer, see section 11DA.

  • (2A)

    An offence against subsection (2) is a strict liability offence.

    Note: For strict liability, see section 6.1 of the Criminal Code.

  • (3)

    Subsection (1) does not require an insurer to give to ASIC any document dealing with the insurance cover provided to a particular person unless:

    • (a)

      that person, or another person having an entitlement to claim under that insurance cover, has given a written authorisation to ASIC permitting ASIC to require the giving of that document; and

    • (b)

      ASIC has given a copy of the authorisation to the insurer with the notice.

      Note: A defendant bears an evidential burden in relation to the matters in subsection (3), see subsection 13.3(3) of the Criminal Code.

  • (4)

    It is a reasonable excuse for an insurer to refuse or fail to comply with the requirements of a notice under subsection (1) if to do so would tend to incriminate the insurer.

    Note: A defendant bears an evidential burden in relation to the matters in subsection (4) (see subsection 13.3(3) of the Criminal Code.

11DSupervisory powers – ASIC may review administrative arrangements etc.
  • (1)

    ASIC may, for any purpose connected with the general administration of the relevant legislation, by notice in writing given to an insurer, require the insurer to give to ASIC, within 30 days of receipt of the notice or such longer period as is specified in the notice:

    • (a)

      written particulars of the organisational structure and administrative arrangements of the insurer either generally or in a particular area of insurance; or

    • (b)

      statistics relating to the nature and volume of the insurance business of the insurer either generally or in a particular area of insurance; or

    • (c)

      copies of any training guides, work manuals or other materials of a similar nature used by an insurer in instructing its employees or any insurance intermediaries dealing with persons who have, or may be likely to seek, insurance cover from the insurer.

  • (2)

    An insurer must not, intentionally or recklessly, give ASIC, in purported compliance with a requirement under subsection (1), particulars or statistics that are false or misleading in a material particular.

    Penalty: 150 penalty units.

    Note: For the liability of a director, employee or agent of an insurer, see section 11DA.

  • (3)

    An insurer must not fail, without reasonable excuse, to comply with the requirements of a notice under subsection (1).

    Penalty: 150 penalty units.

    Note: For the liability of a director, employee or agent of an insurer, see section 11DA.

  • (3A)

    An offence against subsection (3) is a strict liability offence.

    Note: For strict liability, see section 6.1 of the Criminal Code.

  • (4)

    Subsection (1) does not require an insurer to give ASIC a copy of any document or any information:

    • (a)

      that reveals the identity of a particular insured or third party claimant; or

    • (b)

      from which the identity of a particular insured or third party claimant can be deduced.

      Note: A defendant bears an evidential burden in relation to the matters in subsection (4), see subsection 13.3(3) of the Criminal Code.

  • (5)

    It is a reasonable excuse for an insurer to refuse or fail to comply with the requirements of a notice under subsection (1) if to do so would tend to incriminate the insurer.

    Note: A defendant bears an evidential burden in relation to the matters in subsection (5), see subsection 13.3(3) of the Criminal Code.

  • (6)

    In this section:

    third party claimant means a person, other than the insured, who is, or might be, entitled to make a claim under a contract of insurance.

11DASupervisory powers – liability of directors, employees and agents of insurers
  • (1)

    A person commits an offence if:

    • (a)

      the person is:

      • (i)

        a director of a company that is an insurer; or

      • (ii)

        an employee or agent of an insurer; and

    • (b)

      the person permits or authorises the insurer to engage in conduct; and

    • (c)

      the conduct constitutes an offence (the insurer offence) against subsection 11C(2) or 11D(2) or (3); and

    • (d)

      the insurer commits the insurer offence.

      Penalty: 150 penalty units.

  • (2)

    There is no fault element for the physical element described in paragraph (1)(d) other than the fault elements (if any) for the physical elements of the insurer offence.

  • (3)

    To avoid doubt:

    • (a)

      an insurer does not commit the insurer offence, for the purposes of subsection (1), if the insurer has a defence to the insurer offence; and

    • (b)

      a person may be convicted of an offence against subsection (1) even if the insurer concerned has not been prosecuted for, or convicted of, the insurer offence.

  • (4)

    In this section:

    conduct means:

    • (a)

      an act; or

    • (b)

      an omission to perform an act.

    engage in conduct means:

    • (a)

      do an act; or

    • (b)

      omit to perform an act.

11EExamination of documents by ASIC not to imply compliance with relevant legislation

The fact that documents in use by an insurer previously have been given to ASIC under section 11C or 11D does not imply:

  • (a)

    that ASIC has found that the documents comply with the requirements of the relevant legislation; or

  • (b)

    that ASIC endorses any practice or procedure described in the documents.

11FASIC’s power to intervene in proceedings
  • (1)

    ASIC may intervene in any proceeding relating to a matter arising under:

    • (a)

      this Act; or

    • (b)

      Part 3 of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003.

  • (2)

    If ASIC intervenes in a proceeding under subsection (1):

    • (a)

      ASIC is taken to be a party to the proceeding; and

    • (b)

      ASIC has all the rights, duties and liabilities of such a party (subject to this Act or Part 3 of the Medical Indemnity (Prudential Supervision and Product Standards) Act 2003, as the case requires).

  • (3)

    Without limiting subsection (2), ASIC may appear and be represented in a proceeding in which it intervenes under subsection (1):

    • (a)

      by a staff member of ASIC; or

    • (b)

      by a natural person or body to whom ASIC has delegated its functions and powers under this Act; or

    • (c)

      by a solicitor or by counsel.

Part IIThe duty of the utmost good faith  12This Part not to be read down

The effect of this Part is not limited or restricted in any way by any other law, including the subsequent provisions of this Act, but this Part does not have the effect of imposing on an insured, in relation to the disclosure of a matter to the insurer, a duty other than:

  • (a)

    in relation to a consumer insurance contract or proposed consumer insurance contract—the duty to take reasonable care not to make a misrepresentation; or

  • (b)

    in relation to any other contract of insurance or proposed contract of insurance—the duty of disclosure.

    Note: This Part operates in addition to the unfair contract terms provisions of the Australian Securities and Investments Commission Act 2001 (see paragraph 15(2)(d) of this Act).

13The duty of the utmost good faith
  • (1)

    A contract of insurance is a contract based on the utmost good faith and there is implied in such a contract a provision requiring each party to it to act towards the other party, in respect of any matter arising under or in relation to it, with the utmost good faith.

  • (2)

    A failure by a party to a contract of insurance to comply with the provision implied in the contract by subsection (1) is a breach of the requirements of this Act.

  • (2A)

    An insurer under a contract of insurance contravenes this subsection if the insurer fails to comply with the provision implied in the contract by subsection (1).

    Civil penalty: 5,000 penalty units.

  • (3)

    A reference in this section to a party to a contract of insurance includes a reference to a third party beneficiary under the contract.

  • (4)

    This section applies in relation to a third party beneficiary under a contract of insurance only after the contract is entered into.

14Parties not to rely on provisions except in the utmost good faith
  • (1)

    If reliance by a party to a contract of insurance on a provision of the contract would be to fail to act with the utmost good faith, the party may not rely on the provision.

  • (2)

    Subsection (1) does not limit the operation of section 13.

  • (3)

    In deciding whether reliance by an insurer on a provision of the contract of insurance would be to fail to act with the utmost good faith, the court shall have regard to any notification of the provision that was given to the insured, whether a notification of a kind mentioned in section 37 or otherwise.

14APowers of ASIC – insurer’s failure to comply with the duty of the utmost good faith in relation to handling or settlement of claims
  • (1)

    This section applies if an insurer under a contract of insurance has failed to comply with the duty of the utmost good faith in the handling or settlement of a claim or potential claim under the contract.

  • (2)

    Despite any provision of Chapter 7 of the Corporations Act 2001 or any regulation made under that Chapter, ASIC may exercise its powers under Subdivision C of Division 4 of Part 7.6 of that Act or Subdivision A of Division 8 of that Part in relation to the insurer as if the insurer’s failure to comply with the duty of the utmost good faith were a failure by the insurer to comply with a financial services law (within the meaning of the Corporations Act 2001).

    Note: Subdivision C of Division 4 of Part 7.6 of the Corporations Act 2001 deals with variation, suspension and cancellation of an Australian financial services licence, and Subdivision A of Division 8 of that Part deals with banning persons from providing financial services.

15Certain other laws not to apply
  • (1)

    A contract of insurance is not capable of being made the subject of relief under:

    • (a)

      any other Act; or

    • (b)

      a State Act; or

    • (c)

      an Act or Ordinance of a Territory.

  • (2)

    Relief to which subsection (1) applies means relief in the form of:

    • (a)

      the judicial review of a contract on the ground that it is harsh, oppressive, unconscionable, unjust, unfair or inequitable; or

    • (b)

      relief for insureds from the consequences in law of making a misrepresentation;

    but does not include:

    • (c)

      relief in the form of compensatory damages; or

    • (d)

      relief relating to the effect of section 12BF (unfair contract terms) of the Australian Securities and Investments Commission Act 2001.

      Note: See Subdivision G (enforcement and remedies) of Division 2 of Part 2 of the Australian Securities and Investments Commission Act 2001 for certain remedies relating to the effect of section 12BF of that Act.

Part IIIInsurable interestsDivision 1General insurance16Insurable interest not required
  • (1)

    A contract of general insurance is not void by reason only that the insured did not have, at the time when the contract was entered into, an interest in the subject‑matter of the contract.

17Legal or equitable interest not required at time of loss

Where the insured under a contract of general insurance has suffered a pecuniary or economic loss by reason that property the subject‑matter of the contract has been damaged or destroyed, the insurer is not relieved of liability under the contract by reason only that, at the time of the loss, the insured did not have an interest at law or in equity in the property.

Division 2Other contracts of insurance18Insurable interest not required
  • (1)

    This section applies to:

    • (a)

      a contract of life insurance; or

    • (b)

      a contract that provides for the payment of money on the death of a person by sickness or accident.

  • (2)

    A contract to which this section applies is not void by reason only that the insured did not have, at the time when the contract was entered into, an interest in the subject‑matter of the contract.

Division 3Naming of persons benefited20Persons benefited need not be named

An insurer under a contract of insurance is not relieved of liability under the contract by reason only that the names of the persons who may benefit under the contract are not specified in the policy document.

Part IVDisclosures and misrepresentationsDivision 1AConsumer insurance contracts: insured’s duty to take reasonable care not to make a misrepresentation20AApplication of this Division

 This Division applies in relation to:

  • (a)

    consumer insurance contracts; and

  • (b)

    proposed contracts of insurance that, if entered into, would be consumer insurance contracts.

20BThe insured’s duty to take reasonable care not to make a misrepresentation
  • (1)

    Subject to this Act, an insured has a duty to take reasonable care not to make a misrepresentation to the insurer before the relevant contract of insurance is entered into.

  • (2)

    Whether or not an insured has taken reasonable care not to make a misrepresentation is to be determined with regard to all the relevant circumstances.

  • (3)

    Without limiting subsection (2), the following matters may be taken into account in determining whether an insured has taken reasonable care not to make a misrepresentation:

    • (a)

      the type of consumer insurance contract in question, and its target market;

    • (b)

      explanatory material or publicity produced or authorised by the insurer;

    • (c)

      how clear, and how specific, any questions asked by the insurer of the insured were;

    • (d)

      how clearly the insurer communicated to the insured the importance of answering those questions and the possible consequences of failing to do so;

    • (e)

      whether or not an agent was acting for the insured;

    • (f)

      whether the contract was a new contract or was being renewed, extended, varied or reinstated.

  • (4)

    Any particular characteristics or circumstances of the insured of which the insurer was aware, or ought reasonably to have been aware, are to be taken into account in determining whether an insured has taken reasonable care not to make a misrepresentation.

  • (5)

    The insured is not to be taken to have made a misrepresentation merely because the insured:

    • (a)

      failed to answer a question; or

    • (b)

      gave an obviously incomplete or irrelevant answer to a question.

  • (6)

    To avoid doubt, a misrepresentation made fraudulently is made in breach of the duty to take reasonable care not to make a misrepresentation.

20CWarranties of existing facts to be representations

 A statement with respect to the existence of a state of affairs that is:

  • (a)

    made in or in connection with a contract of insurance; and

  • (b)

    made by or attributable to the insured;

does not have effect as a warranty but has effect as though it were a statement made to the insurer by the insured during the negotiations for the contract but before it was entered into.

Division 1Other contracts: insured’s duty of disclosure20EApplication of this Division

 This Division applies in relation to:

  • (a)

    contracts of insurance that are not consumer insurance contracts; and

  • (b)

    proposed contracts of insurance that, if entered into, would not be consumer insurance contracts.

21The insured’s duty of disclosure
  • (1)

    Subject to this Act, an insured has a duty to disclose to the insurer, before the relevant contract of insurance is entered into, every matter that is known to the insured, being a matter that:

    • (a)

      the insured knows to be a matter relevant to the decision of the insurer whether to accept the risk and, if so, on what terms; or

    • (b)

      a reasonable person in the circumstances could be expected to know to be a matter so relevant, having regard to factors including, but not limited to:

      • (i)

        the nature and extent of the insurance cover to be provided under the relevant contract of insurance; and

      • (ii)

        the class of persons who would ordinarily be expected to apply for insurance cover of that kind.

  • (2)

    The duty of disclosure does not require the disclosure of a matter:

    • (a)

      that diminishes the risk;

    • (b)

      that is of common knowledge;

    • (c)

      that the insurer knows or in the ordinary course of the insurer’s business as an insurer ought to know; or

    • (d)

      as to which compliance with the duty of disclosure is waived by the insurer.

  • (3)

    Where a person:

    • (a)

      failed to answer; or

    • (b)

      gave an obviously incomplete or irrelevant answer to;

    a question included in a proposal form about a matter, the insurer shall be deemed to have waived compliance with the duty of disclosure in relation to the matter.

22Insurer to inform of duty of disclosure
  • (1)

    The insurer must, before a contract of insurance is entered into, clearly inform the insured in writing:

    • (a)

      of the general nature and effect of the duty of disclosure; and

    • (c)

      if the contract is a contract of life insurance—of the effect of subsection 27AA(2); and

    • (d)

      that the duty of disclosure applies until the proposed contract is entered into.

  • (2)

    If the proposed contract is a contract of life insurance, the insurer must also, before the contract is entered into, clearly inform, in writing, any person (other than the insured) who, under the contract, would become a life insured of the matters referred to in subsection (1).

  • (3)

    If:

    • (a)

      an insurer complies with subsection (1) in relation to a proposed contract of insurance; and

    • (b)

      the insurer accepts an offer by the insured to enter into the proposed contract, or makes a counter‑offer to enter into another contract of insurance with the insured; and

    • (c)

      the insurer’s acceptance or counter‑offer is made more than 2 months after the insured’s most recent disclosure for the purpose of complying with the duty of disclosure in relation to the proposed contract;

    then the insurer must give to the insured, with the acceptance or counter‑offer, a reminder notice stating that the duty of disclosure applies until the proposed or other contract is entered into.

  • (4)

    If the regulations prescribe a form of writing to be used:

    • (a)

      for informing a person of the matters referred to in subsection (1); or

    • (b)

      for the reminder notice referred to in subsection (3);

    the writing to be used may be in accordance with the prescribed form.

  • (5)

    An insurer who has not complied with subsection (1) and (if applicable) subsection (2) may not exercise a right in respect of a failure to comply with the duty of disclosure, unless the failure was fraudulent.

  • (6)

    If:

    • (a)

      an insurer is required to comply with subsection (3) in relation to a contract of insurance; and

    • (b)

      the insurer does not do so;

    then the insurer may not exercise a right in respect of a failure to comply with the duty of disclosure in relation to a new matter relating to the contract, unless the failure was fraudulent.

  • (7)

    For the purposes of subsection (6), a new matter relating to a contract of insurance is a matter of which the insured first becomes aware after the insured’s most recent disclosure for the purpose of complying with the duty of disclosure in relation to the contract.

Division 2Other contracts: misrepresentations by insured23AApplication of this Division

 This Division applies in relation to:

  • (a)

    contracts of insurance that are not consumer insurance contracts; and

  • (b)

    proposed contracts of insurance that, if entered into, would not be consumer insurance contracts.

23Ambiguous questions

 Where:

  • (a)

    a statement is made in answer to a question asked in relation to a proposed contract of insurance or the provision of insurance cover in respect of a person who is seeking to become a member of a superannuation, retirement or other group life scheme; and

  • (b)

    a reasonable person in the circumstances would have understood the question to have the meaning that the person answering the question apparently understood it to have;

that meaning shall, in relation to the person who made the statement, be deemed to be the meaning of the question.

24Warranties of existing facts to be representations

A statement made in or in connection with a contract of insurance, being a statement made by or attributable to the insured, with respect to the existence of a state of affairs does not have effect as a warranty but has effect as though it were a statement made to the insurer by the insured during the negotiations for the contract but before it was entered into.

25Misrepresentation by life insured

Where, during the negotiations for a contract of life insurance but before it was entered into, a misrepresentation was made to the insurer by a person who, under the contract, became the life insured or one of the life insureds, this Act has effect as though the misrepresentation had been so made by the insured.

26Certain statements not misrepresentations
  • (1)

    Where a statement that was made by a person in connection with a proposed contract of insurance was in fact untrue but was made on the basis of a belief that the person held, being a belief that a reasonable person in the circumstances would have held, the statement shall not be taken to be a misrepresentation.

  • (2)

    A statement that was made by a person in connection with a proposed contract of insurance shall not be taken to be a misrepresentation unless the person who made the statement knew, or a reasonable person in the circumstances could be expected to have known, that the statement would have been relevant to the decision of the insurer whether to accept the risk and, if so, on what terms.

  • (3)

    This section extends to the provision of insurance cover in respect of:

    • (a)

      a person who is seeking to become a member of a superannuation, retirement or other group life scheme; or

    • (b)

      a person who is a holder, or is applying to become a holder, of an RSA.

27Failure to answer questions

A person shall not be taken to have made a misrepresentation by reason only that the person failed to answer a question included in a proposal form or gave an obviously incomplete or irrelevant answer to such a question.

Division 3Remedies for relevant failures27AAMeaning of relevant failure
  • (1)

    In this Act, a relevant failure in relation to a contract of insurance is:

    • (a)

      if the contract is, or would be, a consumer insurance contract—a misrepresentation made by the insured in breach of the duty to take reasonable care not to make a misrepresentation; or

    • (b)

      otherwise:

      • (i)

        a failure by the insured to comply with the duty of disclosure; or

      • (ii)

        a misrepresentation made by the insured to the insurer before the contract was entered into.

  • (2)

    Without limiting subsection (1), if, in relation to a contract of life insurance under which a person other than the insured would become a life insured:

    • (a)

      the life insured made a misrepresentation during the negotiations for the contract but before it was entered into; and

    • (b)

      the misrepresentation would have been a breach of the duty to take reasonable care not to make a misrepresentation if that duty had applied to the life insured in relation to the contract;

    then the misrepresentation is a relevant failure in relation to the contract (whether or not the contract is a consumer insurance contract).

27ACertain contracts of life insurance may be treated as if they comprised 2 or more separate contracts of life insurance
  • (1)

    If:

    • (a)

      a contract of life insurance includes 2 or more groups of provisions (for example, provisions that are grouped into 2 or more separate parts); and

    • (b)

      each group of provisions could form a single contract of life insurance;

    then this Division applies as if each group of provisions were a separate contract of life insurance.

  • (2)

    If:

    • (a)

      a contract of life insurance includes 2 or more groups of provisions (for example, provisions that are grouped into 2 or more separate parts); and

    • (b)

      because of subsection (1), this Division applies as if each group of provisions were a separate contract of life insurance; and

    • (c)

      the contract also includes provisions (related provisions) that relate to or affect the operation of one or more of the groups of provisions referred to in paragraph (a);

    then the related provisions are, for the purposes of this Division, to be regarded as provisions included in each relevant separate contract of life insurance referred to in paragraph (b).

  • (3)

    If a contract of life insurance provides insurance cover in relation to 2 or more life insureds, this Division applies as if the insurance cover provided in relation to each life insured were provided by a separate contract of life insurance.

  • (4)

    If a contract of life insurance provides:

    • (a)

      insurance cover in relation to a life insured that is underwritten on particular terms; and

    • (b)

      insurance cover in relation to that life insured that:

      • (i)

        is not underwritten; or

      • (ii)

        is underwritten on different terms;

    then this Division applies as if the insurance cover referred to in paragraph (a) and the insurance cover referred to in paragraph (b) were each provided by a separate contract of life insurance.

    Note: The effect of this section in relation to a contract of life insurance to which subsection (1), (3) or (4) applies is that different remedies may be available to the insurer in respect of each separate contract of life insurance that is taken to exist by virtue of the relevant subsection.

28General insurance
  • (1)

    This section applies if a relevant failure occurs in relation to a contract of general insurance, but does not apply if the insurer would have entered into the contract, for the same premium and on the same terms and conditions, even if the failure had not occurred.

  • (2)

    If the relevant failure was fraudulent, the insurer may avoid the contract.

  • (3)

    If the insurer is not entitled to avoid the contract or, being entitled to avoid the contract (whether under subsection (2) or otherwise) has not done so, the liability of the insurer in respect of a claim is reduced to the amount that would place the insurer in a position in which the insurer would have been if the relevant failure had not occurred.

29Life insurance

Scope

(1)

This section applies if a relevant failure occurs in relation to a contract of life insurance, but does not apply if:

  • (a)

    the insurer would have entered into the contract even if the failure had not occurred; or

  • (b)

    the failure was in respect of the date of birth of one or more of the life insureds.

    Note: If subsection 27A(1), (3) or (4) applies to the contract of life insurance, different remedies may be available to the insurer in respect of each separate contract of life insurance that is taken to exist by virtue of the relevant subsection.

Insurer may avoid contract

(2)

If the relevant failure was fraudulent, the insurer may avoid the contract.

(3)

If:

  • (a)

    the relevant failure was not fraudulent; and

  • (b)

    the insurer would not have been prepared to enter into a contract of life insurance with the insured on any terms, if the relevant failure had not occurred;

the insurer may, within 3 years after the contract was entered into, avoid the contract.

Insurer may vary contract

(4)

If the insurer has not avoided the contract, whether under subsection (2) or (3) or otherwise, the insurer may, by notice in writing given to the insured, vary the contract by substituting for the sum insured (including any bonuses) a sum that is not less than the sum ascertained in accordance with the formula

 

where:

Sis the number of dollars that is equal to the sum insured (including any bonuses).

P is the number of dollars that is equal to the premium that has, or to the sum of the premiums that have, become payable under the contract; and

Q is the number of dollars that is equal to the premium, or to the sum of the premiums, that the insurer would have been likely to have charged if the relevant failure had not occurred.

Note: This subsection applies differently in relation to a contract with a surrender value, or a contract that provides insurance cover in respect of the death of a life insured (see subsection (10)).

(5)

In the application of subsection (4) in relation to a contract that provides for periodic payments, the sum insured means each such payment (including any bonuses).

(6)

If the insurer has not avoided the contract or has not varied the contract under subsection (4), the insurer may, by notice in writing given to the insured, vary the contract in such a way as to place the insurer in the position (subject to subsection (7)) in which the insurer would have been if the relevant failure had not occurred.

Note: This subsection does not apply in relation to a contract with a surrender value, or a contract that provides insurance cover in respect of the death of a life insured (see subsection (10)).

(7)

The position of the insurer under a contract (the relevant contract) that is varied under subsection (6) must not be inconsistent with the position in which other reasonable and prudent insurers would have been if:

  • (a)

    they had entered into similar contracts of life insurance to the relevant contract; and

  • (b)

    there had been no relevant failure in relation to the similar contracts.

(8)

For the purposes of subsection (7), a contract of life insurance (the similar contract) is similar to another contract of life insurance (the relevant contract) if:

  • (a)

    the similar contract provides insurance cover that is the same as, or similar to, the kind of insurance cover provided by the relevant contract; and

  • (b)

    the similar contract was entered into at, or close to, the time the relevant contract was entered into.

Date of effect of variation of contract

(9)

A variation of a contract under subsection (4) or (6) has effect from the time when the contract was entered into.

Exception for contracts with a surrender value or that provide cover on death

(10)

If the contract is a contract with a surrender value, or a contract that provides insurance cover in respect of the death of a life insured:

  • (a)

    the insurer may vary the contract under subsection (4) before the expiration of 3 years after the contract was entered into, but not after that period; and

  • (b)

    subsections (6), (7) and (8) do not apply in relation to the contract.

30Misstatements of age
  • (1)

    In this section, the standard formula, in relation to a contract of life insurance means the formula

     

    where:

    S is the number of dollars that is equal to the sum insured (including any bonuses).

    P is the number of dollars that is equal to the premium that has, or to the sum of the premiums that have, become payable under the contract; and

    Q is the number of dollars that is equal to the premium, or to the sum of the premiums, that would have become payable under the contract if it or they had been ascertained on the basis of the correct date of birth or dates of birth.

  • (2)

    If the date of birth of one or more of the life insureds under a contract of life insurance was not correctly stated to the insurer at the time when the contract was entered into:

    • (a)

      where the sum insured (including any bonuses) exceeds the amount in dollars ascertained in accordance with the standard formula—the insurer may at any time vary the contract by substituting for the sum insured (including any bonuses) an amount that is not less than the amount in dollars so ascertained; and

    • (b)

      where the sum insured (including any bonuses) is less than the amount so ascertained, the insurer shall either:

      • (i)

        reduce, as from the date on which the contract was entered into, the premium payable to the amount that would have been payable if the contract had been based on the correct date of birth or correct dates of birth and repay the amount of overpayments of premium (less any amount that has been paid as the cash value of bonuses in excess of the cash value that would have been paid if the contract had been based on the correct date of birth or correct dates of birth) together with interest on that amount at the prescribed rate computed from the date on which the contract was entered into; or

      • (ii)

        vary the contract by substituting for the sum insured (including any bonuses) the amount in dollars so ascertained.

  • (3)

    In the application of subsection (2) in relation to a contract that provides for periodic payments, the sum insured means each such payment (including any bonuses).

  • (3A)

    If:

    • (a)

      the expiration date of a contract of life insurance is calculated by reference to the date of birth of a person who is a life insured under the contract; and

    • (b)

      the person’s date of birth was not correctly stated to the insurer at the time when the contract was entered into;

    then the insurer may (instead of doing any of the things referred to in subsection (2)) vary the contract by changing its expiration date to the date that would have been the expiration date if the contract had been based on the correct date of birth.

  • (4)

    A variation of a contract under subsection (2) or (3A) has effect from the time when the contract was entered into.

31Court may disregard avoidance in certain circumstances
  • (1)

    In any proceedings by the insured in respect of a contract of insurance that has been avoided on the ground of fraudulent relevant failure, the court may, if it would be harsh and unfair not to do so, but subject to this section, disregard the avoidance and, if it does so, shall allow the insured to recover the whole, or such part as the court thinks just and equitable in the circumstances, of the amount that would have been payable if the contract had not been avoided.

  • (2)

    The power conferred by subsection (1) may be exercised only where the court is of the opinion that, in respect of the loss that is the subject of the proceedings before the court, the insurer has not been prejudiced by the relevant failure or, if the insurer has been so prejudiced, the prejudice is minimal or insignificant.

  • (3)

    In exercising the power conferred by subsection (1), the court:

    • (a)

      shall have regard to the need to deter fraudulent conduct in relation to insurance; and

    • (b)

      shall weigh the extent of the culpability of the insured in the fraudulent conduct against the magnitude of the loss that would be suffered by the insured if the avoidance were not disregarded;

    but may also have regard to any other relevant matter.

  • (4)

    The power conferred by subsection (1) applies only in relation to the loss that is the subject of the proceedings before the court, and any disregard by the court of the avoidance does not otherwise operate to reinstate the contract.

32Relevant failure by life insured covered under group life contract
  • (1)

    This Division extends to the case where there was a relevant failure in respect of a proposed life insured under a group life contract, as if:

    • (a)

      the insurance cover provided by the group life contract in respect of the life insured were provided by an individual contract of life insurance between the insurer and the insured; and

    • (b)

      the group life contract had been entered into at the time when the proposed life insured became a life insured under the group life contract.

  • (2)

    For the purposes of this Division, if the relevant failure occurred after the proposed life insured became a member of the relevant superannuation, retirement or other group life scheme but before the insurance cover was provided by the group life contract in respect of the life insured, then the failure is taken to have occurred before the proposed life insured became a life insured under the group life contract.

32ARelevant failure by holder of RSA

This Division extends to the case where there was a relevant failure in relation to a holder, or a person applying to become a holder, of an RSA as though:

  • (a)

    the insurance cover provided in relation to that RSA in respect of that person were provided by a contract between the insurer as insurer and the RSA provider as the insured; and

  • (b)

    that contract has been entered into at the time when the holder became the holder, or the person applying to become the holder, became the holder.

33No other remedies

The provisions of this Division are exclusive of any right that the insurer has otherwise than under this Act in respect of a failure by the insured to disclose a matter to the insurer before the contract was entered into and in respect of a misrepresentation or incorrect statement.

Division 4Key Facts Sheets33AApplication of this Division

 This Division applies in relation to:

  • (a)

    a contract of insurance (in this Division called a prescribed contract) that is included in a class of contracts of insurance declared by the regulations to be a class of contracts in relation to which this Division applies; and

  • (b)

    a proposed or possible contract of insurance (in this Division called a potential prescribed contract) that would, if entered into, be a prescribed contract.

33BWhat is a Key Facts Sheet?

 For the purposes of this Division, a Key Facts Sheet for a prescribed contract, or a potential prescribed contract, is a document:

  • (a)

    that contains the information relating to the prescribed contract, or the potential prescribed contract, that is required by the regulations; and

  • (b)

    that complies with any other requirements prescribed by the regulations.

33CInsurer’s obligation to provide Key Facts Sheet
  • (1)

    An insurer must provide a Key Facts Sheet for a prescribed contract, or a potential prescribed contract, in the circumstances, and in the manner, prescribed by the regulations.

    Civil penalty: 5,000 penalty units.

  • (2)

    Regulations made for the purposes of subsection (1) may prescribe circumstances in which a Key Facts Sheet may or must be provided by electronic means. The regulations have effect despite subsection 77(1).

  • (3)

    The regulations may prescribe exceptions to the requirement in subsection (1).

    Note: A defendant bears an evidential burden in relation to a matter prescribed for the purposes of subsection (3) (see subsection 13.3(3) of the Criminal Code).

  • (4)

    The following provisions do not apply in relation to the requirement in subsection (1):

    • (a)

      subsection 11(11);

    • (b)

      section 69.

    Offence

  • (5)

    An insurer commits an offence if:

    • (a)

      the insurer is subject to a requirement under subsection (1); and

    • (b)

      the insurer engages in conduct; and

    • (c)

      the conduct contravenes the requirement.

      Penalty: 150 penalty units.

33DProvision of Key Facts Sheet does not constitute clearly informing

For the purposes of this Act, the provision by an insurer of a Key Facts Sheet to a person does not constitute clearly informing the person of the matters contained in the Key Facts Sheet.

Part VThe contractDivision 1Standard cover34Interpretation

 In this Division:

minimum amount, in relation to a claim, means the amount declared by the regulations to be the minimum amount in relation to a class of claims in which that claim is included.

prescribed contract means a contract of insurance that is included in a class of contracts of insurance declared by the regulations to be a class of contracts in relation to which this Division applies.

prescribed event, in relation to a prescribed contract, means an event that is declared by the regulations to be a prescribed event in relation to that contract.

35Notification of certain provisions
  • (1)

    Where:

    • (a)

      a claim is made under a prescribed contract; and

    • (b)

      the event the happening of which gave rise to the claim is a prescribed event in relation to the contract;

    the insurer may not refuse to pay an amount equal to the minimum amount in relation to the claim by reason only that the effect of the contract, but for this subsection, would be that the event the happening of which gave rise to the claim was an event in respect of which:

    • (c)

      the amount of the insurance cover provided by the contract was less than the minimum amount; or

    • (d)

      insurance cover was not provided by the contract.

  • (2)

    Subsection (1) does not have effect where the insurer proves that, before the contract was entered into, the insurer clearly informed the insured in writing (whether by providing the insured with a document containing the provisions, or the relevant provisions, of the proposed contract or otherwise) or the insured knew, or a reasonable person in the circumstances could be expected to have known:

    • (a)

      where the effect of the contract, but for subsection (1), would be that the liability of the insurer in respect of a claim arising upon the happening of the event would be less than the minimum amount—what the extent of the insurer’s liability under the contract in respect of such a claim would be; or

    • (b)

      where the effect of the contract, but for subsection (1), would be that the insurer would be under no liability in respect of such a claim—that the contract would not provide insurance cover in respect of the happening of that event.

  • (3)

    Regulations made for the purposes of this section take effect at the expiration of 60 days after the day on which they are registered on the Federal Register of Legislation under the Legislation Act 2003.

  • (4)

    Where regulations made for the purposes of this section are amended after the day on which a particular contract of insurance is entered into, the amendments shall be disregarded in relation to the application of subsection (1) to that contract.

36Interpretation of regulations

 If a question arises whether an event is a prescribed event, the relevant provisions of the regulations shall be construed as though they were provisions of a contract put forward by the insurer.

37Notification of unusual terms

An insurer may not rely on a provision included in a contract of insurance (not being a prescribed contract) of a kind that is not usually included in contracts of insurance that provide similar insurance cover unless, before the contract was entered into the insurer clearly informed the insured in writing of the effect of the provision (whether by providing the insured with a document containing the provisions, or the relevant provisions, of the proposed contract or otherwise).

Division 1ADefinition of flood37AApplication of this Division
  • (1)

    This Division applies in relation to a contract of insurance (in this Division called a prescribed contract) if:

    • (a)

      the contract is included in a class of contracts of insurance declared by the regulations to be a class of contracts in relation to which this Division applies; and

    • (b)

      the contract was entered into after the day on which those regulations were made.

  • (2)

    However, this Division does not apply in relation to a prescribed contract at any time before the transition time for the prescribed contract.

  • (3)

    Also, this Division does not affect the operation of a prescribed contract in relation to an event that occurred before the transition time for the prescribed contract.

  • (4)

    In this section:

    transition time, for a prescribed contract, means the time when regulations made for the purposes of paragraph (1)(a), declaring a class of contracts of insurance including the contract to be a class of contracts in relation to which this Division applies, commence.

37BMeaning of flood in prescribed contracts etc.
  • (1)

    The regulations must define the meaning of flood for the purposes of this Division.

  • (2)

    In a prescribed contract (or a notice or other document or information given by the insurer in relation to a prescribed contract):

    • (a)

      the word flood has the meaning given by the regulations; and

    • (b)

      other parts of speech or grammatical forms of that word have corresponding meanings.

  • (3)

    Subsection (2) has effect in relation to a prescribed contract (or a notice or other document or information given by the insurer in relation to a prescribed contract) even if the meaning of the word flood (or other parts of speech or grammatical forms of that word) provided by the contract (or the notice or other document or information) is different from the meaning of flood given by the regulations.

37CInsurer must clearly inform insured whether prescribed contract provides insurance cover in respect of flood

Before entering into a prescribed contract, the insurer must clearly inform the insured in writing whether the contract provides insurance cover in respect of loss or damage caused by, or resulting from, flood as defined by the regulations.

37DCircumstances in which prescribed contract is taken to provide insurance cover etc. in respect of flood
  • (1)

    This section applies in relation to a prescribed contract that includes provisions (flood provisions) that provide insurance cover in respect of loss or damage caused by, or resulting from, one or more flood events (whether or not the contract expressly provides insurance cover for flood as defined by the regulations).

  • (2)

    The flood provisions of the prescribed contract are taken to provide insurance cover in respect of loss or damage caused by, or resulting from, flood as defined by the regulations.

  • (3)

    The insurer under the prescribed contract may not refuse to pay a claim in respect of loss or damage caused by, or resulting from, the happening of a flood event by reason only that, but for subsection (2), insurance cover in respect of loss or damage caused by, or resulting from, that event was not provided by the contract.

  • (4)

    If the prescribed contract includes provisions (also flood provisions) that provide different maximum amounts of insurance cover in respect of different flood events, those provisions are taken to provide a maximum amount of insurance cover in respect of loss or damage caused by, or resulting from, flood, as defined by the regulations, equal to the highest maximum amount (the maximum flood cover amount) of insurance cover provided by those provisions in respect of any flood event.

  • (5)

    The insurer under the prescribed contract may not refuse to pay an amount equal to the maximum flood cover amount in relation to a claim in respect of loss or damage caused by, or resulting from, the happening of a flood event by reason only that, but for subsection (4), the maximum amount of insurance cover provided by the contract in respect of loss or damage caused by, or resulting from, that event was less than the maximum flood cover amount.

  • (5A)

    To avoid doubt, this section does not affect the operation of any provisions of a prescribed contract that are not flood provisions.

  • (6)

    This section has effect in relation to a prescribed contract whether or not the insurer clearly informed the insured of the purported effect of the flood provisions in the contract.

  • (7)

    In this section:

    flood event means an event that is, or would be, a flood as defined by the regulations.

37EDivision not to affect provision of insurance cover for certain events

 If:

  • (a)

    a prescribed contract is expressed to provide insurance cover in respect of loss or damage caused by, or resulting from, a particular event; and

  • (b)

    the effect of another provision of this Division is that the contract would not provide that insurance cover;

then that provision is taken not to have that effect.

Division 2General provisions relating to insurance contracts38Interim contracts of insurance
  • (1)

    Where, under a provision included in an interim contract of insurance, the liability of the insurer is dependent upon the submission to, or the acceptance by, the insurer of a proposal for a contract of insurance intended to replace the interim contract of insurance, the provision is void.

  • (2)

    Where:

    • (a)

      an insurer has entered into an interim contract of insurance; and

    • (b)

      before the insurance cover provided by the contract has expired, the insured has submitted a proposal to the insurer for a contract of insurance intended to replace the interim contract of insurance;

    the insurer remains liable in accordance with the interim contract of insurance until the earliest of the following times:

    • (c)

      the time when insurance cover commences under another contract of insurance (whether or not it is an interim contract of insurance) between the insured and the insurer or some other insurer, being insurance cover that is intended to replace the insurance cover provided by the interim contract of insurance;

    • (d)

      the time when the interim contract of insurance is cancelled;

    • (e)

      if the insured withdraws the proposal—the time of withdrawal.

  • (3)

    Sections 35, 37, 37C, 40 and 44 and subsection 68(1) do not apply in relation to interim contracts of insurance.

39Instalment contracts of general insurance

 Where a provision included in an instalment contract of general insurance has the effect of limiting the liability of the insurer by reference to non‑payment of an instalment of the premium, the insurer may not refuse to pay a claim, in whole or in part, by reason only of the operation of that provision unless:

  • (a)

    at least one instalment of the premium has remained unpaid for a period of at least 14 days; and

  • (b)

    before the contract was entered into, the insurer clearly informed the insured, in writing, of the effect of the provision.

40Certain contracts of liability insurance
  • (1)

    This section applies in relation to a contract of liability insurance the effect of which is that the insurer’s liability is excluded or limited by reason that notice of a claim against the insured in respect of a loss suffered by some other person is not given to the insurer before the expiration of the period of the insurance cover provided by the contract.

  • (2)

    The insurer shall, before the contract is entered into:

    • (a)

      clearly inform the insured in writing of the effect of subsection (3); and

    • (b)

      if the contract does not provide insurance cover in relation to events that occurred before the contract was entered into, clearly inform the insured in writing that the contract does not provide such cover.

      Penalty: 300 penalty units.

  • (3)

    Where the insured gave notice in writing to the insurer of facts that might give rise to a claim against the insured as soon as was reasonably practicable after the insured became aware of those facts but before the insurance cover provided by the contract expired, the insurer is not relieved of liability under the contract in respect of the claim, when made, by reason only that it was made after the expiration of the period of the insurance cover provided by the contract.

41Contracts of liability insurance – consent of insurer required for settlement etc. of claim
  • (1)

    This section applies in relation to a contract of liability insurance if it would constitute a breach of the contract if, without the consent of the insurer, the insured or any third party beneficiary were:

    • (a)

      to settle or compromise a claim against the insured or third party beneficiary; or

    • (b)

      to make an admission or payment in respect of such a claim.

  • (2)

    If the insured or any third party beneficiary (the claimant) under the contract has made a claim under the contract, the claimant may at any time, by notice in writing given to the insurer, require the insurer to inform the claimant in writing:

    • (a)

      whether the insurer admits that the contract applies to the claim; and

    • (b)

      if the insurer so admits—whether the insurer proposes to conduct, on behalf of the claimant, the negotiations and any legal proceedings in respect of the claim made against the claimant.

  • (3)

    If the insurer does not, within a reasonable time after being given a notice under subsection (2), inform the claimant:

    • (a)

      that the insurer admits that the contract of liability insurance applies to the claim; and

    • (b)

      that the insurer proposes to conduct, on behalf of the claimant, the negotiations and any legal proceedings in respect of the claim made against the claimant;

    then:

    • (c)

      the insurer may not refuse payment of the claim; and

    • (d)

      the amount payable in respect of the claim is not reduced;

    by reason only that the claimant breached the contract as mentioned in subsection (1).

42Maximum cover for premium

 The maximum liability of the insurer under a contract of general insurance is the highest amount of insurance cover that the insurer would, at the time when the contract was entered into, have been prepared to provide under a contract that was, apart from the maximum liability under that contract, in the same terms and in respect of the same subject‑matter and risk as those of the first‑mentioned contract.

43Arbitration provisions
  • (1)

    Where a provision included in a contract of insurance has the effect of:

    • (a)

      requiring, authorizing or otherwise providing for differences or disputes in connection with the contract to be referred to arbitration; or

    • (b)

      limiting the rights otherwise conferred by the contract on the insured by reference to an agreement to submit a difference or dispute to arbitration;

    the provision is void.

  • (2)

    Subsection (1) does not affect an agreement to submit a dispute or difference to arbitration if the agreement was made after the dispute or difference arose.

44Average provisions
  • (1)

    An insurer may not rely on an average provision included in a contract of general insurance unless, before the contract was entered into, the insurer clearly informed the insured in writing of the nature and effect of the provision including whether the provision is based on indemnity or on replacement value of the property that is the subject‑matter of the contract.

  • (2)

    Where the sum insured in respect of property that is the subject‑matter of a contract of general insurance that provides insurance cover in respect of loss of or damage to a building used primarily and principally as a residence for the insured, for persons with whom the insured has a family or personal relationship, or for both the insured and such persons, or loss of or damage to the contents of such a building, or both, is not less than 80% of the value of the property, the liability of the insurer in respect of loss of or damage to the property is not reduced by reason only of the operation of an average provision included in the contract.

  • (3)

    Where:

    • (a)

      the sum insured in respect of property that is the subject‑matter of such a contract is less than 80% of the value of the property; and

    • (b)

      but for this subsection, an average provision included in the contract would have the effect of reducing the liability of the insurer in respect of loss of or damage to the property to an amount that is less than the amount ascertained in accordance with the formula

     

     where:

    Ais the number of dollars equal to the amount of the loss or damage.

    Sis the amount of the sum insured under the contract in respect of the property; and

    Pis 80% of the number of dollars equal to the value of the property.

    the average provision has the effect of reducing the liability of the insurer to the amount so ascertained.

  • (4)

    In this section:

    value, in relation to property, means:

    • (a)

      if the relevant contract provides for indemnifying the insured in respect of loss of or damage to the property¾the indemnity value of the property; or

    • (b)

      if the relevant contract provides for reinstatement or replacement of the property¾the reinstatement or replacement value of the property;

    at the time when the relevant contract was entered into.

45“Other insurance” provisions
  • (1)

    Where a provision included in a contract of general insurance has the effect of limiting or excluding the liability of the insurer under the contract by reason that the insured has entered into some other contract of insurance, not being a contract required to be effected by or under a law, including a law of a State or Territory, the provision is void.

  • (2)

    Subsection (1) does not apply in relation to a contract that provides insurance cover in respect of some or all of so much of a loss as is not covered by a contract of insurance that is specified in the first‑mentioned contract.

46Pre‑existing defect or imperfection
  • (1)

    This section applies where a claim under a contract of insurance (other than a contract of insurance that is included in a class of contracts declared by the regulations to be a class of contracts in relation to which this section does not apply) is made in respect of a loss that occurred as a result, in whole or in part, of a defect or imperfection in a thing.

  • (2)

    Where, at the time when the contract was entered into, the insured was not aware of, and a reasonable person in the circumstances could not be expected to have been aware of, the defect or imperfection, the insurer may not rely on a provision included in the contract that has the effect of limiting or excluding the insurer’s liability under the contract by reference to the condition, at a time before the contract was entered into, of the thing.

      • (ii)

        if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision—the person may be prosecuted in a court, or proceedings seeking a pecuniary penalty order may be brought, in relation to the alleged contravention; or

      • (iii)

        if the alleged contravention is of a civil penalty provision—proceedings seeking a pecuniary penalty order may be brought in relation to the alleged contravention; and

    • (o)

      state that the person may make written representations to ASIC seeking the withdrawal of the notice.

  • (2)

    The amount to be stated in the notice for the purposes of paragraph (1)(f) is:

    • (a)

      for a single contravention of an offence provision—half the maximum penalty that a court could impose on the person for the contravention; and

    • (b)

      for multiple contraventions of an offence provision—the amount worked out under paragraph (a) for a single contravention multiplied by the number of contraventions; and

    • (c)

      for a single contravention of a civil penalty provision—12 penalty units for an individual and 60 penalty units for a body corporate; and

    • (d)

      for multiple contraventions of a civil penalty provision—the amount worked out under paragraph (c) for a single contravention multiplied by the number of contraventions.

75ZPayment period

Usual payment period

(1)

The payment period for an infringement notice begins on the day after the notice is given and, unless otherwise specified in this section, continues for 28 days.

Payment period extended under section 75ZA

(2)

If, under section 75ZA, ASIC extends the payment period for the notice, the payment period is as extended.

(3)

If ASIC refuses an application under subsection 75ZA(1) for an extension of the payment period for the notice, the payment period ends on the latest of the following days:

  • (a)

    the last day of the period that, without the extension that has been refused, would be the payment period for the notice;

  • (b)

    the day that is 7 days after the day the applicant was given notice of ASIC’s decision not to extend;

  • (c)

    the day that is 7 days after the day the application is taken to have been refused under subsection 75ZA(4).

Instalments

(4)

If, under section 75ZB, ASIC makes an arrangement for the amount payable under the notice to be paid by instalments, the payment period ends on the earlier of the following days:

  • (a)

    the last day on which an instalment is to be paid under the arrangement;

  • (b)

    if the person fails to pay an instalment in accordance with the arrangement, the last day on which the missed instalment was to be paid.

(5)

If ASIC refuses an application made under subsection 75ZB(1) to make an arrangement for the amount payable under the notice to be paid by instalments, the payment period ends on the latest of the following days:

  • (a)

    the last day of the period that, without the instalment arrangement, would be the payment period for the notice;

  • (b)

    the day that is 7 days after the day the applicant was given notice of ASIC’s decision not to make the arrangement;

  • (c)

    the day that is 7 days after the day the application is taken to have been refused under subsection 75ZB(4).

Payment period if ASIC refuses to withdraw infringement notice

(6)

If ASIC refuses a representation made under subsection 75ZC(1) for the notice to be withdrawn, the payment period ends on the latest of the following days:

  • (a)

    the last day of the period that, without the withdrawal, would be the payment period for the notice;

  • (b)

    the day that is 7 days after the day the person was given notice of ASIC’s decision not to withdraw the notice;

  • (c)

    the day that is 7 days after the day on which, under subsection 75ZC(5), ASIC is taken to have refused to withdraw the infringement notice.

75ZAExtension of time to pay amount
  • (1)

    A person to whom an infringement notice has been given may, during the payment period for the notice, apply to ASIC for an extension of the payment period for the notice.

  • (2)

    ASIC may, in writing, extend the payment period for an infringement notice:

    • (a)

      if a person makes an application in accordance with subsection (1); or

    • (b)

      on ASIC’s own initiative.

    ASIC may do so before or after the end of the payment period.

  • (3)

    ASIC must do each of the following within 14 days after an application in accordance with subsection (1) is made:

    • (a)

      grant or refuse to grant an extension of the payment period for the infringement notice;

    • (b)

      give the applicant notice in writing of ASIC’s decision.

  • (4)

    If ASIC does not comply with subsection (3):

    • (a)

      ASIC is taken to have refused to grant an extension of the payment period for the infringement notice; and

    • (b)

      the refusal is taken to have occurred on the last day of the 14 day period.

  • (5)

    ASIC may extend the payment period more than once under subsection (2).

75ZBPayment by instalments
  • (1)

    A person to whom an infringement notice has been given may, within 28 days after the infringement notice is given, apply to ASIC to make an arrangement to pay the amount payable under the infringement notice by instalments.

  • (2)

    ASIC may, in writing, make an arrangement for a person to pay the amount payable under an infringement notice by instalments:

    • (a)

      if a person makes an application in accordance with subsection (1); or

    • (b)

      on ASIC’s own initiative.

    ASIC may do so before or after the end of the payment period.

  • (3)

    ASIC must do each of the following within 14 days after an application in accordance with subsection (1) is made:

    • (a)

      decide to make, or refuse to make, an arrangement for the applicant to pay the amount payable under the infringement notice by instalments;

    • (b)

      give the applicant notice in writing of ASIC’s decision;

    • (c)

      if ASIC decides to make the arrangement, specify in the notice:

      • (i)

        the day by which each instalment is to be paid; and

      • (ii)

        the amount of each instalment.

  • (4)

    If ASIC does not comply with subsection (3):

    • (a)

      ASIC is taken to have refused to make an arrangement for the applicant to pay the amount payable under the infringement notice by instalments; and

    • (b)

      the refusal is taken to have occurred on the last day of the 14 day period.

  • (5)

    ASIC may vary an arrangement for a person to pay the amount payable under an infringement notice by instalments.

  • (6)

    If:

    • (a)

      a person does not pay all of the instalments in accordance with an arrangement made under this section; and

    • (b)

      the person is prosecuted, or proceedings seeking a pecuniary penalty order are brought, for the alleged contravention;

    ASIC must refund to the person the amount of any instalments paid.

75ZCWithdrawal of an infringement notice

Representations seeking withdrawal of notice

(1)

A person to whom an infringement notice has been given may, within 28 days after the infringement notice is given, make written representations to ASIC seeking the withdrawal of the notice.

Withdrawal of notice

(2)

ASIC may withdraw an infringement notice given to a person:

  • (a)

    if the person makes representations to ASIC in accordance with subsection (1); or

  • (b)

    on ASIC’s own initiative.

ASIC may do so before or after the end of the payment period.

(3)

ASIC must, within 14 days after a representation is made in accordance with subsection (1):

  • (a)

    decide to withdraw, or refuse to withdraw, the infringement notice; and

  • (b)

    if ASIC decides to withdraw the notice—give the applicant a withdrawal notice in accordance with subsection (6); and

  • (c)

    if ASIC decides to refuse to withdraw the notice—give the applicant notice of that fact.

(4)

When deciding whether to withdraw, or refuse to withdraw, an infringement notice, ASIC:

  • (a)

    must take into account any written representations seeking the withdrawal that were given by the person to ASIC; and

  • (b)

    may take into account the following:

    • (i)

      whether a court has previously imposed a penalty on the person for a contravention of a provision of this Act;

    • (ii)

      the circumstances of the alleged contravention;

    • (iii)

      whether the person has paid an amount, stated in an earlier infringement notice, for a contravention of a provision of this Act;

    • (iv)

      any other matter ASIC considers relevant.

(5)

If ASIC does not comply with subsection (3):

  • (a)

    ASIC is taken to have refused to make an arrangement for the applicant to pay the amount payable under the infringement notice by instalments; and

  • (b)

    the refusal is taken to have occurred on the last day of the 14 day period.

Notice of withdrawal

(6)

Notice of the withdrawal of the infringement notice must be given to the person. The withdrawal notice must state:

  • (a)

    the person’s name and address; and

  • (b)

    the day the infringement notice was given; and

  • (c)

    the identifying number of the infringement notice; and

  • (d)

    that the infringement notice is withdrawn; and

  • (e)

    that:

    • (i)

      if the alleged contravention is of an offence provision and would not also constitute a contravention of a civil penalty provision—the person may be prosecuted in a court for the alleged contravention; or

    • (ii)

      if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision—the person may be prosecuted in a court, or proceedings seeking a pecuniary penalty order may be brought, in relation to the alleged contravention; or

    • (iii)

      if the alleged contravention is of a civil penalty provision—proceedings seeking a pecuniary penalty order may be brought in relation to the alleged contravention.

Refund of amount if infringement notice withdrawn

(7)

If:

  • (a)

    ASIC withdraws the infringement notice; and

  • (b)

    the person has already paid all or part of the amount stated in the notice;

ASIC must refund to the person an amount equal to the amount paid.

75ZDEffect of payment of amount
  • (1)

    If the person to whom an infringement notice for an alleged contravention of a provision is given pays the amount stated in the notice before the end of the payment period for the notice:

    • (a)

      any liability of the person for the alleged contravention is discharged; and

    • (b)

      if the alleged contravention is of an offence provision and would not also constitute a contravention of a civil penalty provision—the person may not be prosecuted in a court for the alleged contravention; and

    • (c)

      if the alleged contravention is of an offence provision and would also constitute a contravention of a civil penalty provision—the person may not be prosecuted in a court, and proceedings seeking a pecuniary penalty order may not be brought, in relation to the alleged contravention; and

    • (d)

      if the alleged contravention is of a civil penalty provision—proceedings seeking a pecuniary penalty order may not be brought in relation to the alleged contravention; and

    • (e)

      the person is not regarded as having admitted guilt or liability for the alleged contravention; and

    • (f)

      if the provision is an offence provision—the person is not regarded as having been convicted of the alleged offence.

  • (2)

    Subsection (1) does not apply if the notice has been withdrawn.

75ZEEffect of this Division

 This Division does not:

  • (a)

    require an infringement notice to be given to a person for an alleged contravention of a provision subject to an infringement notice under this Division; or

  • (b)

    affect the liability of a person for an alleged contravention of a provision subject to an infringement notice under this Division if:

    • (i)

      the person does not comply with an infringement notice given to the person for the contravention; or

    • (ii)

      an infringement notice is not given to the person for the contravention; or

    • (iii)

      an infringement notice is given to the person for the contravention and is subsequently withdrawn; or

  • (c)

    prevent the giving of 2 or more infringement notices to a person for an alleged contravention of a provision subject to an infringement notice under this Division; or

  • (d)

    limit a court’s discretion to determine the amount of a penalty to be imposed on a person who is found to have contravened a provision subject to an infringement notice under this Division.

Part XMiscellaneous  76Contribution between insurers
  • (1)

    When 2 or more insurers are liable under separate contracts of general insurance to the same insured in respect of the same loss, the insured is, subject to subsection (2), entitled immediately to recover from any one or more of those insurers such amount as will, or such amounts as will in the aggregate, indemnify the insured fully in respect of the loss.

  • (2)

    Nothing in subsection (1) entitles an insured:

    • (a)

      to recover from an insurer an amount that exceeds the sum insured under the contract between the insured and that insurer; or

    • (b)

      to recover an amount that exceeds, or amounts that in the aggregate exceed, the amount of the loss.

  • (3)

    Nothing in this section prejudices the rights of an insurer or insurers from whom the insured recovers an amount or amounts in accordance with this section to contribution from any other insurer liable in respect of the same loss.

78Regulations

The Governor‑General may make regulations, not inconsistent with this Act, prescribing matters:

  • (a)

    required or permitted by this Act to be prescribed;

  • (b)

    necessary or convenient to be prescribed for carrying out or giving effect to this Act; or

  • (c)

    amending the time limits provided for in sections 39, 58 and 69.

Endnotes

Endnote 1About the endnotes

The endnotes provide information about this compilation and the compiled law.

The following endnotes are included in every compilation:

Endnote 1—About the endnotes

Endnote 2—Abbreviation key

Endnote 3—Legislation history

Endnote 4—Amendment history

Abbreviation key—Endnote 2

The abbreviation key sets out abbreviations that may be used in the endnotes.

Legislation history and amendment history—Endnotes 3 and 4

Amending laws are annotated in the legislation history and amendment history.

The legislation history in endnote 3 provides information about each law that has amended (or will amend) the compiled law. The information includes commencement details for amending laws and details of any application, saving or transitional provisions that are not included in this compilation.

The amendment history in endnote 4 provides information about amendments at the provision (generally section or equivalent) level. It also includes information about any provision of the compiled law that has been repealed in accordance with a provision of the law.

Editorial changes

The Legislation Act 2003 authorises First Parliamentary Counsel to make editorial and presentational changes to a compiled law in preparing a compilation of the law for registration. The changes must not change the effect of the law. Editorial changes take effect from the compilation registration date.

If the compilation includes editorial changes, the endnotes include a brief outline of the changes in general terms. Full details of any changes can be obtained from the Office of Parliamentary Counsel.

Misdescribed amendments

A misdescribed amendment is an amendment that does not accurately describe how an amendment is to be made. If, despite the misdescription, the amendment can be given effect as intended, then the misdescribed amendment can be incorporated through an editorial change made under section 15V of the Legislation Act 2003.

If a misdescribed amendment cannot be given effect as intended, the amendment is not incorporated and “(md not incorp)” is added to the amendment history.

Endnote 2Abbreviation key

ad = added or inserted

o = order(s)

am = amended

Ord = Ordinance

amdt = amendment

orig = original

c = clause(s)

par = paragraph(s)/subparagraph(s)

C[x] = Compilation No. x

/sub‑subparagraph(s)

Ch = Chapter(s)

pres = present

def = definition(s)

prev = previous

Dict = Dictionary

(prev…) = previously

disallowed = disallowed by Parliament

Pt = Part(s)

Div = Division(s)

r = regulation(s)/rule(s)

ed = editorial change

reloc = relocated

exp = expires/expired or ceases/ceased to have

renum = renumbered

effect

rep = repealed

F = Federal Register of Legislation

rs = repealed and substituted

gaz = gazette

s = section(s)/subsection(s)

LA = Legislation Act 2003

Sch = Schedule(s)

LIA = Legislative Instruments Act 2003

Sdiv = Subdivision(s)

(md) = misdescribed amendment can be given

SLI = Select Legislative Instrument

effect

SR = Statutory Rules

(md not incorp) = misdescribed amendment

Sub‑Ch = Sub‑Chapter(s)

cannot be given effect

SubPt = Subpart(s)

mod = modified/modification

underlining = whole or part not

No. = Number(s)

commenced or to be commenced

Endnote 3Legislation history

Act

Number and year

Assent

Commencement

Application, saving and transitional provisions

Insurance Contracts Act 1984

80, 1984

25 June 1984

1 Jan 1986 (gaz1985, No S487)

Statute Law (Miscellaneous Provisions) Act (No. 1) 1985

65, 1985

5 June 1985

Sch 1: 3 July 1985 (s 2(1))

Australian Trade Commission (Transitional Provisions and Consequential Amendments) Act 1985

187, 1985

16 Dec 1985

Sch 4: 6 Jan 1986 (gaz 1985, No S551)

s 60(3)

Statute Law (Miscellaneous Provisions) Act (No. 2) 1985

193, 1985

16 Dec 1985

Sch 1: 1 Jan 1986 (s 2(8))

s 16

Statute Law (Miscellaneous Provisions) Act (No. 1) 1986

76, 1986

24 June 1986

Sch 1: 1 Jan 1986 (s 2(11))

s 9

Statute Law (Miscellaneous Provisions) Act (No. 2) 1986

168, 1986

18 Dec 1986

Sch 1: 1 Jan 1986 (s 2(6))

s 5(1)

Export Finance and Insurance Corporation (Transitional Provisions and Consequential Amendments) Act 1991

149, 1991

21 Oct 1991

1 Nov 1991

s. 50(2)

Insurance Laws Amendment Act (No. 2) 1994

49, 1994

7 Apr 1994

Sch (items 2, 4, 5, 7, 17): 7 Apr 1994 (s 2(1))

Sch (items 3, 6, 8–16): 1 Oct 1994 (s 2(2) and gaz 1994, No GN38)

Life Insurance (Consequential Amendments and Repeals) Act 1995

5, 1995

23 Feb 1995

1 July 1995 (s 2 and gaz 1995, No GN24)

Crimes and Other Legislation Amendment Act 1997

20, 1997

7 Apr 1997

Sch 2 (item 6): 7 Apr 1997 (s 2(1))

Retirement Savings Accounts (Consequential Amendments) Act 1997

62, 1997

28 May 1997

2 June 1997 (s 2 and gaz 1997, No S202)

Financial Laws Amendment Act 1997

107, 1997

30 June 1997

Sch 8: 30 June 1997 (s 2(1))

Insurance Laws Amendment Act 1998

35, 1998

22 Apr 1998

Sch 1 (items 77–84): 30 Apr 1998 (s 2(2))

Sch 1 (items 82–84)

Financial Sector Reform (Amendments and Transitional Provisions) Act 1998

54, 1998

29 June 1998

Sch 12: 1 July 1998 (s 2(2)(j))

Financial Sector Reform (Amendments and Transitional Provisions) Act (No. 1) 1999

44, 1999

17 June 1999

Sch 7 (item 117): 1 July 1999 (s 3(2)(e), (16) and gaz 1999, No S283)

as amended by

Financial Sector Legislation Amendment Act (No. 1) 2000

160, 2000

21 Dec 2000

Sch 4 (items 4, 5): 18 Jan 2001) (s 2(1))

Export Finance and Insurance Corporation Amendment Act 2000

11, 2000

15 Mar 2000

Schedule 1 (item 4): 1 July 1998

Schedule 2 (items 2–4): 1 July 2000

Remainder: Royal Assent

Treasury Legislation Amendment (Application of Criminal Code) Act (No. 3) 2001

117, 2001

18 Sept 2001

s 4 and Sch 3 (items 5–14): 15 Dec 2001 (s 2(1))

s 4

Financial Services Reform (Consequential Provisions) Act 2001

123, 2001

27 Sept 2001

Sch 1 (items 246–249): 11 Mar 2002 (s 2(1) and (6))

Insurance and Aviation Liability Legislation Amendment Act 2002

96, 2002

10 Nov 2002

Schedule 1 (items 1–4): 23 July 1998 (see s. 2(1))

Remainder: Royal Assent

s. 4

Medical Indemnity (Prudential Supervision and Product Standards) (Consequential Amendments) Act 2003

36, 2003

2 May 2003

1 July 2003

Private Health Insurance (Transitional Provisions and Consequential Amendments) Act 2007

32, 2007

30 Mar 2007

Schedule 2 (item 54): 1 Apr 2007 (see s. 2(1))

Private Health Insurance Legislation Amendment Act 2008

54, 2008

25 June 2008

Sch 1 (item 5): 25 June 2008 (s 2)

Statute Law Revision Act 2008

73, 2008

3 July 2008

Sch 4 (items 343–347): 4 July 2008 (s 2(1) item 64)

Insurance Contracts Amendment Act 2012

41, 2012

15 Apr 2012

15 Apr 2012 (s 2)

Personal Liability for Corporate Fault Reform Act 2012

180, 2012

10 Dec 2012

Sch 6 (items 20–22) and Sch 7: 11 Dec 2012 (s 2)

Sch 7

Insurance Contracts Amendment Act 2013

75, 2013

28 June 2013

Sch 1, Sch 3, Sch 4 (items 3–5), Sch 5 (items 1–3, 12–17) and Sch 6 (items 23–29): 28 June 2013 (s 2(1) items 2, 4, 6, 9, 11, 13)

Sch 2 and Sch 7: 28 Dec 2013 (s 2(1) items 3, 15)

Sch 4 (items 1, 2, 6–15): 28 Dec 2015 (s 2(1) items 5, 7, 8)

Sch 5 (items 4–11) and Sch 6 (items 1–22, 30–40): 28 June 2014 (s 2(1) items 10, 12, 14)

Sch 1 (items 6, 8, 10), Sch 2 (item 9), Sch 3 (item 2), Sch 4 (items 2, 7, 8, 13, 15), Sch 5 (items 3, 11, 14, 17), Sch 6 (items 2, 14, 17, 22, 29, 40) and Sch 7 (item 3)

Territories Legislation Amendment Act 2016

33, 2016

23 Mar 2016

Sch 5 (item 74): 1 July 2016 (s 2(1) item 7)

Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Act 2019

17, 2019

12 Mar 2019

Sch 4: 13 Mar 2019 (s 2(1) item 2)

Sch 5 (item 36): never commenced (s 2(1) item 10)

Sch 4 (item 5)

Financial Sector Reform (Hayne Royal Commission Response—Protecting Consumers (2019 Measures)) Act 2020

2, 2020

17 Feb 2020

Sch 1 (items 8–10): 5 Apr 2021 (s 2(1) item 2)

Sch 1 (item 10)

as amended by

Treasury Laws Amendment (Modernising Business Communications and Other Measures) Act 2023

69, 2023

14 Sept 2023

Sch 4 (item 64): 15 Sept 2023 (s 2(1) item 5)

Treasury Laws Amendment (2019 Measures No. 3) Act 2020

64, 2020

22 June 2020

Sch 3 (items 253, 325, 326): 1 Oct 2020 (s 2(1) item 6)

Sch 3 (items 325, 326)

Financial Sector Reform (Hayne Royal Commission Response) Act 2020

135, 2020

17 Dec 2020

Sch 2: 1 Jan 2021 (s 2(1) items 3, 4)

Sch 2 (items 2, 37)

Federal Circuit and Family Court of Australia (Consequential Amendments and Transitional Provisions) Act 2021

13, 2021

1 Mar 2021

Sch 2 (item 476): 1 Sept 2021 (s 2(1) item 5)

Treasury Laws Amendment (2021 Measures No. 5) Act 2021

127, 2021

7 Dec 2021

Sch 3 (items 24–27): 8 Dec 2021 (s 2(1) item 4)

Treasury Laws Amendment (2023 Law Improvement Package No. 1) Act 2023

76, 2023

20 Sept 2023

Sch 2 (items 668, 669): 20 Oct 2023 (s 2(1) item 2)

Sch 4 (item 90): 1 Mar 2024 (s 2(1) item 15)

Endnote 4Amendment history

Provision affected

How affected

Part I

s 4.........................................

am No 75, 2013

s 6.........................................

am No 33, 2016

s 9.........................................

am No 65, 1985; No 187, 1985; No 76, 1986; No 149, 1991; No 107, 1997; No 11, 2000; No 96, 2002; No 32, 2007; No 54, 2008; No 75, 2013

s 9A.......................................

ad No 35, 1998

s 11........................................

am No 65, 1985; No 168, 1986; No 49, 1994; No 5, 1995; No 62, 1997; No 107, 1997; No 54, 1998; No 44, 1999; No 123, 2001; No 41, 2012; No 75, 2013; No 17, 2019; No 135, 2020; No 13, 2021

s 11AA..................................

ad No 117, 2001

s 11AB...................................

ad No 135, 2020

Part IA

Part IA...................................

ad. No. 49, 1994

s. 11AAA...............................

ad. No. 36, 2003

s 11A.....................................

ad No 49, 1994

rs No 54, 1998

am No 76, 2023

s. 11B....................................

ad. No. 49, 1994

am. No. 54, 1998; No. 36, 2003

s. 11C....................................

ad. No. 49, 1994

am. No. 54, 1998; No. 117, 2001; No. 36, 2003; No 180, 2012

s. 11D....................................

ad. No. 49, 1994

am. No. 54, 1998; No. 117, 2001; No. 36, 2003; No 180, 2012

s. 11DA.................................

ad. No. 180, 2012

s. 11E....................................

ad. No. 49, 1994

am. No. 54, 1998; No. 36, 2003

s. 11F.....................................

ad. No. 49, 1994

rs. No. 107, 1997

rep. No. 54, 1998

ad. No. 75, 2013

s 11G.....................................

ad No 49, 1994

rep No 54, 1998

s 11H.............................................

ad No 49, 1994

rep No 54, 1998

Part II

s 12........................................

am No 2, 2020; No 135, 2020

s 13........................................

am No 75, 2013; No 17, 2019

s 14A.....................................

ad No 75, 2013

am No 76, 2023

s 15........................................

rs No 65, 1985; No 49, 1994

am No 2, 2020

Part III

Division 1

s 16........................................

am No 5, 1995

Division 2

Division 2..............................

rs No 5, 1995

s 18........................................

rs No 5, 1995

s 19........................................

rep No 5, 1995

Part IV

Division 1A

Division 1A............................

ad No 135, 2020

s 20A.....................................

ad No 135, 2020

s 20B.....................................

ad No 135, 2020

s 20C.....................................

ad No 135, 2020

Division 1

Division 1 heading..................

rs No 41, 2012; No 135, 2020

s 20E.....................................

ad No 135, 2020

s 21........................................

am No 107, 1997; No 75, 2013

s 21A.....................................

ad No 35, 1998

rs No 75, 2013

rep No 135, 2020

s 21B.....................................

ad No 75, 2013

rep No 135, 2020

s 22........................................

am No 35, 1998

rs No 75, 2013

am No 135, 2020

Division 2

Division 2 heading..................

rs No 41, 2012; No 135, 2020

s 23A.....................................

ad No 135, 2020

s 23........................................

am No 75, 2013

s 26........................................

am No 62, 1997; No 107, 1997; No 75, 2013

s 27........................................

am No 107, 1997

Division 3

Division 3 heading..................

rs No 41, 2012; No 135, 2020

s 27AA..................................

ad No 135, 2020

s 27A.....................................

ad No 75, 2013

s 28........................................

am No 107, 1997; No 135, 2020

s 29........................................

am No 107, 1997; No 75, 2013; No 135, 2020

s 30........................................

am No 75, 2013

s 31........................................

am No 135, 2020

s 31A.....................................

ad No 75, 2013

rep No 135, 2020

s 32........................................

rs No 75, 2013

am No 135, 2020

s 32A.....................................

ad No 62, 1997

am No 75, 2013; No 135, 2020

Division 4

Division 4..............................

ad No 41, 2012

s 33A.....................................

ad No 41, 2012

s 33B.....................................

ad No 41, 2012

s 33C.....................................

ad No 41, 2012

am No 17, 2019

s 33D.....................................

ad No 41, 2012

Part V

Division 1

s 35........................................

am No 65, 1985; No 193, 1985; No 107, 1997; No 64, 2020

s 37........................................

am No 65, 1985; No 168, 1986

Division 1A

Division 1A............................

ad No 41, 2012

ss. 37A–37E...........................

ad. No. 41, 2012

Division 2

s. 38.......................................

am. No. 41, 2012

s. 40.......................................

am. No. 49, 1994

s. 41.......................................

am. No. 65, 1985; No. 107, 1997

rs No 75, 2013

s. 44.......................................

am. No. 107, 1997

s 46........................................

am No 107, 1997

s 47........................................

am No 107, 1997

s. 48.......................................

am. No. 5, 1995; No. 107, 1997; No. 73, 2008; No 75, 2013

s. 48AA.................................

ad. No. 62, 1997; No 75, 2013

s. 48A....................................

ad. No. 5, 1995

am No 75, 2013

s. 49.......................................

am. No. 168, 1986; No. 107, 1997

s. 51.......................................

am. No. 107, 1997; No 75, 2013

Division 3

s. 54.......................................

am. No. 65, 1985; No. 107, 1997

s. 55A....................................

ad. No. 49, 1994

am. No. 54, 1998; No. 75, 2013

Part VI

s 57........................................

am No 107, 1997; No 35, 1998

Part VII

s 58........................................

am No 168, 1986; No 107, 1997

s 59........................................

am No 5, 1995; No 107, 1997

s 59A.....................................

ad No 75, 2013

s 60........................................

am No 135, 2020

s 62........................................

am No 75, 2013

s 63........................................

rs No 75, 2013

s 64........................................

am No 49, 1994; No 5, 1995; No 62, 1997; No 107, 1997

rep No 123, 2001

ad No 75, 2013

s 64A.....................................

ad No 49, 1994

rep No 123, 2001

s 64B.....................................

ad No 5, 1995

rep No 123, 2001

Part VIII

s 65........................................

am No 49, 1994; No 107, 1997; No 73, 2008

s 66........................................

am No 107, 1997; No 54, 1998

s 67........................................

rs No 75, 2013

s 68........................................

am No 107, 1997

Part IX

s 69........................................

am No 65, 1985; No 168, 1986; No 35, 1998

s 70........................................

am No 75, 2013

s 71........................................

am No 168, 1986; No 75, 2013

s 71A.....................................

ad No 49, 1994

rep No 123, 2001

s 72........................................

am No 107, 1997

rs No 75, 2013

s 72A.....................................

ad No 75, 2013

s 73........................................

am No 65, 1985; No 76, 1986; No 168, 1986; No. 49, 1994

rep No 123, 2001

s 74........................................

am No 49, 1994; No 107, 1997; No 117, 2001

s 75........................................

am No 49, 1994; No 20, 1997; No 107, 1997; No 117, 2001; No 73, 2008

Part IXA

Part IXA................................

ad No 17, 2019

Division 1

Subdivision A

s 75A.....................................

ad No 17, 2019

s 75B.....................................

ad No 17, 2019

s 75C.....................................

ad No 17, 2019

s 75D.....................................

ad No 17, 2019

s 75E.....................................

ad No 17, 2019

s 75F......................................

ad No 17, 2019

s 75G.....................................

ad No 17, 2019

s 75H.....................................

ad No 17, 2019

s 75J......................................

ad No 17, 2019

s 75K.....................................

ad No 17, 2019

Subdivision B

s 75L.....................................

ad No 17, 2019

s 75M....................................

ad No 17, 2019

s 75N.....................................

ad No 17, 2019

s 75P......................................

ad No 17, 2019

Subdivision C

s 75Q.....................................

ad No 17, 2019

s 75R.....................................

ad No 17, 2019

s 75S......................................

ad No 17, 2019

s 75T.....................................

ad No 17, 2019

s 75U.....................................

ad No 17, 2019

s 75V.....................................

ad No 17, 2019

Division 2

s 75W....................................

ad No 17, 2019

s 75X.....................................

ad No 17, 2019

s 75Y.....................................

ad No 17, 2019

am No 127, 2021

s 75Z.....................................

ad No 17, 2019

am No 127, 2021

s 75ZA...................................

ad No 17, 2019

s 76ZB...................................

ad No 17, 2019

s 75ZC...................................

ad No 17, 2019

s 75ZD...................................

ad No 17, 2019

s 75ZE...................................

ad No 17, 2019

Part X

s 76........................................

am No 107, 1997

s 76A.....................................

ad No 49, 1994

rep No 180, 2012

s 77........................................

am No 107, 1997

rep No 75, 2013

 
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