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AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION ACT 2001 - SECT 12DQ Prohibition on selling add - on insurance products before end of add - on insurance deferral period etc.

AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION ACT 2001 - SECT 12DQ

Prohibition on selling add - on insurance products before end of add - on insurance deferral period etc.

Contraventions by provider of principal product or service

  (1)   A person (the first person ) contravenes this subsection if:

  (a)   another person (the customer ) acquires, or enters into a commitment to acquire, a product or service (the principal product or service ) from the first person; and

  (b)   the first person also sells a financial product to the customer; and

  (c)   the financial product is an add - on insurance product in relation to the principal product or service.

Note:   Failure to comply with this subsection is an offence (see section   12GB).

  (2)   A person (the first person ) contravenes this subsection if:

  (a)   another person (the customer ) acquires, or enters into a commitment to acquire, a product or service (the principal product or service ) from the first person; and

  (b)   a third person sells the customer a financial product that is an add - on insurance product in relation to the principal product or service.

Note:   Failure to comply with this subsection is an offence (see section   12GB).

Exception for sale after add - on insurance deferral period

  (3)   Subsections   (1) and (2) do not apply if:

  (a)   there is an add - on insurance deferral period in relation to the customer acquiring, or entering into a commitment to acquire, the principal product or service; and

  (b)   the add - on insurance product is sold to the customer after the end of the add - on insurance deferral period.

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

Contravention by third party provider

  (4)   A person (the third party provider ) contravenes this subsection if:

  (a)   the third party provider sells a financial product to a consumer (the customer ); and

  (b)   the financial product is an add - on insurance product in relation to a product or service (the principal product or service ) offered or provided by another person; and

  (c)   either:

  (i)   there is no add - on insurance deferral period in relation to the customer acquiring, or entering into a commitment to acquire, the principal product or service; or

  (ii)   there is such an add - on insurance deferral period, and the third party provider sells the add - on insurance product to the customer before the end of the period.

Note:   Failure to comply with this subsection is an offence (see section   12GB).

Timing of sale

  (5)   For the purposes of this section, an add - on insurance product is taken to be sold to a customer no later than the first time at which no further action from the customer is required for the sale to occur (even if the sale does not occur until a later time).