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News<br />
New jewellery insurance regulations in wake of Royal Commission<br />
Reforms to add-on insurance are impacting the<br />
jewellery industry, with consumers bearing the<br />
risk of having uninsured pieces.<br />
<strong>Jeweller</strong>y insurance providers are adapting to<br />
fresh regulations, introduced following Kenneth<br />
Hayne QC's Royal Commission into Misconduct<br />
in the Banking, Superannuation and Financial<br />
Services Industry.<br />
The restrictions form part of the Financial Sector<br />
Reform (Hayne Royal Commission Response) Bill,<br />
passed by Federal Parliament in December 2020,<br />
and which came into effect on 5 October <strong>2021</strong>.<br />
They are designed to prevent the ‘hawking’ of<br />
financial products, such as insurance, to retail<br />
clients for whom they were not designed.<br />
The reforms include the introduction of a<br />
‘deferred sales model’ for add-on insurance –<br />
defined as insurance products offered or sold in<br />
connection with the purchase of a principal good<br />
or service – in order to strengthen consumer<br />
confidence and prevent ‘pressure selling’.<br />
In practice, this means that when jewellers refer<br />
a customer to an insurer, the customer “must<br />
wait four days before being able to take out the<br />
insurance,” Lachlan Renshaw, managing director<br />
of Centrestone <strong>Jeweller</strong>y Insurance, told <strong>Jeweller</strong>.<br />
“The intention by regulators was to protect<br />
consumers from being forced into insurance<br />
policies they didn’t need.<br />
"Specifically, they named wheel-rim insurance<br />
and mobile phone insurance as products which<br />
provided little to no value to the consumer."<br />
Renshaw added, “In reality, for the jewellery<br />
industry, what this means is that if a customer<br />
comes into a jewellery store to pick up their new<br />
jewellery, they cannot insure it for four days and<br />
the risk falls onto the customer.”<br />
In order to address this risk, Centrestone<br />
<strong>Jeweller</strong>y Insurance has introduced a<br />
complementary four-day policy for customers<br />
referred by jewellers “so there is no break in cover<br />
and the customer is insured from the moment<br />
they activate their cover with us,” Renshaw said.<br />
The comprehensive four day policy offers all the<br />
same policy features as Centrestone <strong>Jeweller</strong>y<br />
Insurance standard policy for jewellery items<br />
up to $50,000, with like-for-like replacement<br />
provided by the referring jeweller.<br />
This offer is fully compliant with the new<br />
regulations and means that customer do not<br />
need to wait four days until obtaining cover.<br />
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