AAI & MTA car dealer add-on insurance class action

Add-on insurance is a term used to describe an insurance product that is ‘added on’ to the sale of another product which is the main focus for the consumer i.e. a motor vehicle.

The common types of add-on insurance sold through car dealers are:

• Loan Protection Insurance (also referred to as “repayment insurance”, “consumer credit insurance” or “CCI”). This insures a borrower’s capacity to make repayments under a car loan, including insurance against sickness, injury, disability, death or unemployment;
  
  
• Motor Equity Insurance (also referred to as “guaranteed asset protection insurance”, “GAP insurance”, “shortfall insurance”, “equity insurance”, “equity plus insurance”, “cash benefit insurance”, “purchase price insurance” or “value protect insurance”). This covers the difference between what a consumer owes on their car loan and any amount they may receive under their comprehensive insurance policy, if the car is a total loss;
  
  
• Extended Motor Warranty (also referred to as “mechanical insurance”, “motor vehicle warranty” “mechanical breakdown insurance”, “extended manufacturers warranty”, “extended vehicle warranty insurance”, or “extended warranty insurance”). This covers the cost of repairing or replacing parts of the car due to mechanical failure after the manufacturer’s or dealer’s warranty has expired; and
  
  
• Tyre and Rim Insurance. This covers the cost of repairing or replacing damaged tyres and rims from blowouts, punctures or other road damage.

The Australian Securities and Investments Commission (ASIC) has undertaken extensive reviews into this industry. Its reviews suggested that add-on insurance sold through car dealers represents poor value for consumers. 

The more common types of motor vehicle insurance such as comprehensive, third party property, or compulsory third-party insurance are not part of the AAI Car Dealer Add-On Insurance Class Action.

Group members will never have to pay any legal costs out of their own pocket.

If the class action is successful, the plaintiff’s legal costs will be calculated as 25% of any settlement or judgment sum recovered. This means that 75% of any settlement or judgment sum will be distributed to the Group Members.

This is called a “group costs order” and it was approved by the Court.

The court can change that percentage at any time during the class action, but if that happens the Court will consider the best interests of Group Members, and Group Members will be notified of any change. 

If the class action is unsuccessful, Maurice Blackburn will cover any costs the Court may order against us, and group members will not be liable to pay any costs.

More information regarding the GCO and costs in general is in the Funding Information Summary Statement. 

Group members will never have to pay any legal costs out of their own pocket.

If the class action is unsuccessful, Maurice Blackburn will cover any costs the Court may order against us, and group members will not be liable to pay any costs.

The deadline to register to participate in any pre-trial settlement has now passed (the deadline was 4pm on 18 June 2024 (AEST)).

You may still register your interest in the class action here, however you will not be eligible to claim money if there is a settlement before the trial, unless the Court makes a further order.

If you did not register and did not opt out before 18 June 2024 at 4pm (AEST), you may still be eligible to claim compensation if there is no pre-trial settlement.

If you would like further information regarding the AAI & MTA Class Action, please contact us at aai_addonclassaction@mauriceblackburn.com.au or on 1800 571 256.