ACCC acts on NIB health insurance advertising

5 May 2015

NIB Health Funds Ltd (NIB) has paid a penalty of $10,200 following the issue of an Infringement Notice by the Australian Competition and Consumer Commission in relation to advertising about the waiver of the waiting period for “Extras” cover.

From December 2012 to November 2014, in promoting its combined Hospital and Extras cover, NIB offered to waive the waiting period on its Extras option which it represented as “usually” or “normally” requiring a 2 month wait.

The Infringement Notice was issued to NIB because the ACCC had reasonable grounds to believe that NIB had contravened the Australian Consumer Law (ACL) by making a false or misleading representation that it usually or normally required a 2 month waiting period for the Extras option, when in fact NIB had made this benefit available to all customers immediately for 23 months from December 2012.

“Consumers should be able to make informed purchasing decisions. Claims that benefits are only available if a product or service is purchased by a specified date must be true and not mislead consumers,” ACCC Commissioner Sarah Court said.

“Businesses which extend an offer for a considerable time beyond its original expiry date should ensure that representations made in connection with the offer do not become misleading to consumers as a result.”

The payment of a penalty specified in an infringement notice is not an admission of a contravention of the ACL. The ACCC can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer protection laws.

Release number: 
MR 76/15
ACCC Infocentre: 

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