The Federal Court has found that Choosi Pty Ltd misled consumers in relation to its funeral and life insurance comparison services.
The Court found that Choosi made representations to consumers that conveyed it compared products from a range of funeral and life insurers.
However, in respect of funeral insurance, from 1 July 2019, Choosi only compared policies issued by a single insurer, Hannover Life Re of Australasia Ltd. In respect of life insurance, from 1 July 2019 to 30 June 2023, Choosi only compared policies issued by Hannover and a single policy issued by Swiss Re Life & Health Australia. From 1 July 2023, all life insurance policies Choosi compared were issued by Hannover. All policies were distributed by Greenstone Financial Services Pty Ltd, a company associated with Choosi.
ASIC alleged that 4,225 Hannover funeral insurance policies and 9,478 Hannover life insurance policies were sold through Choosi’s comparison service between 1 July 2019 and 30 November 2024.
ASIC Chair Sarah Court said the Court upheld ASIC's concerns that consumers seeking to compare insurance products to find the best price were misled about the choices available to them.
‘Consumers deserve clear and accurate information about how comparison services operate and the products they do, or do not, compare.
‘Businesses cannot create the impression that they offer consumers genuine choice from a range of products when that choice does not exist.
‘At a time when many Australians are looking for the best value products, misleading consumers about the range of products being compared may undermine their ability to make informed financial decisions.
‘This outcome sends a strong message that businesses must be transparent about the products they compare and the choices they offer consumers.’
ASIC alleged that Choosi's website, advertising, and promotional materials conveyed that consumers could compare funeral and life insurance policies from a range of insurers, when the products compared were overwhelmingly sourced from a single insurer and distributed by a related entity.
In delivering judgment, Justice Anderson said, ‘Through the Choosi Website, and each of the impugned advertising materials, Choosi falsely gave consumers the impression that its Comparison Service compared policies from a broader range of insurers than it in fact did’.
‘...[T]he repeated emphasis throughout the Choosi Website and advertising materials was that Choosi would save consumers time and effort, do the hard work of comparing policies, simplify an otherwise complex process, and assist consumers to make an informed choice. The premise underlying those statements is that the consumer is receiving the benefit of a meaningful comparison across the available market. Consumers, generally speaking, use comparison services because they offer an efficient substitute for consumers undertaking lengthy research themselves across many platforms, in this case saving consumers from approaching insurers individually. A reasonable consumer would, therefore, understand references to a “range” of insurers as conveying that the service surveys a meaningful selection of insurers available in the market, rather than merely two insurers. The comparative value of such a service derives, at least in substantial part, from the breadth of the market being surveyed,’ Justice Anderson said.
The matter will return to the Court on a date to be determined for submissions on penalty and other relief sought by ASIC.
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Background
ASIC commenced proceedings in the Federal Court against Choosi on 2 June 2025, alleging Choosi contravened ss 12DB and 12DF of the Australian Securities and Investments Commission Act 2001 (25-092MR).
ASIC’s Moneysmart website has guidance for consumers for how to use comparison websites for insurance and other financial services.