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Financial, Banking & Insurance Disputes - Frequently Asked Questions

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What kind of financial advisor can I make a claim against?

There are many types of financial advisors including financial planners, brokers, banks, accountants, stock brokers, lawyers and the like. If someone has offered you financial advice or sold you a financial product, and have breached their duty of care to you, you may have a claim for compensation.

What is a duty of care?

The law provides that in some situations one party (for example a financial planner) owes another a duty of care. That duty results in an obligation to act reasonably which would include ensuring all appropriate information is obtained and provided by the planner, that the investment strategy and product are appropriate. If not, the planner may have been negligent and if you have suffered a loss you may have a claim for compensation.

What types of conduct amount to negligence?

There are many types of conduct which could be negligent. This would include your financial planner not obtaining full instructions from you and not understanding your financial circumstances or your risk profile. In addition, the product recommended needs to be properly explained and understood. Your investments need to be monitored. The planner needs to make disclosures about his fees and commissions. They need to be ethical. We recommend you contact a National Compensation Lawyer to discuss whether a financial advisor’s conduct has been negligent.

What compensation would I be entitled to?

If you can show your financial planner or bank have been negligent and you have suffered a loss as a result, the law attempts to put you back into the position you were in before the negligence occurred. Compensation may include the repayment of your money, loss of profits or expenses incurred. Once you have discussed you claim with a National Compensation Lawyer, we will be in a better position to provide a more accurate assessment of compensation payable.

Are there time limitations in lodging these claims?

Yes. In many disputes involving financial products or insurance, internal complaint procedures are allowed with the organisation and/or the Financial Ombudsmen. Time periods are attached to these. In addition, if you wish to pursue a claim through the Court, you normally need to do so within 6 years of the negligent advice being received.

Are banks and insurance companies regulated?

Yes. Financial advisors, banks and insurance companies are regulated by legislation, industry standards, Codes of Practice and the like. Significant consumer protections are provided. Unfortunately, if you are unaware of this protection, you will not take advantage of it. We recommend you contact a National Compensation Lawyer to discuss your rights.

My insurance company has denied my claim. They say I failed to disclose important information.

Insureds have an obligation to inform insurance companies of certain information. However, insurance companies have strict obligations to notify insureds of their duty of disclosure. Further, they should ask appropriate questions. Whilst you may have failed to disclose certain information, or misrepresented certain facts, it does not automatically mean your claim should be denied. There are circumstances in which your claim could still be accepted and paid.

For example:

  • Most insurance policies provide insured’s need to take “reasonable precautions” to prevent damage to their property. Insurers regularly rely on this wording when denying a claim. The Courts however interpret this clause to a very high standard. Accordingly, the insurer needs to prove an insured was aware of the substantive risk, but deliberately and wilfully ignored it.
  • Motor policies say your vehicle needs to be in a roadworthy condition. If your vehicle was not (i.e. in breach of the policy), but was stolen, you will likely still be able to claim as the fact the vehicle was un-roadworthy had nothing to do with the insured event (i.e. theft).
My insurance claim has been denied. My insurer says I have committed a fraud.

Fraud is an extremely serious allegation to make. The onus is on an insurer to prove you have committed a fraud. Given the seriousness of the allegation, the Court places a high burden of proof on the insurer. Unless they have direct proof, it is very difficult to successfully maintain a denial of a claim for fraud.

For more information or to arrange an obligation free consultation with a lawyer please call us on 1300 FEARLESS (1300 332 753)