Australia’s corporate watchdog, the Australian Securities and Investments Commission (ASIC), has launched legal proceedings against RACQ Insurance, a unit of Insurance Australia Group (IAG). The regulator alleges the company misled thousands of policyholders by failing to update them about key policy changes, raising significant governance and conduct concerns.
This case adds to a growing list of global enforcement actions where regulators are holding financial institutions accountable for misleading practices, underscoring the importance of transparency and strong oversight.
What happened?
ASIC claims that between 2017 and 2022, RACQ Insurance misled more than 400,000 customers by not properly informing them about changes in home and car insurance policies.
Specifically, the company allegedly failed to communicate when certain automatic renewal features or benefits were removed, leaving customers with reduced coverage without their knowledge.
ASIC argues this conduct breached consumer protection laws and is seeking financial penalties. The case will be heard in Australia’s Federal Court.
Notably, the Integrum ESG Platform had already flagged Insurance Australia Group (IAG), the parent company of RACQ Insurance, as high risk in this area. IAG received the lowest possible score for the metric 'Selling Practices & Product Labeling', signalling concerns around how products are marketed and disclosed.
These insights give investors early visibility into governance and conduct risks that can escalate into regulatory or reputational challenges.
Why this matters (for managers)
This case illustrates how mis-selling and weak disclosure controls can quickly escalate into significant regulatory and reputational risks.
The implications are not confined to insurers - they extend to any regulated industry where marketing, pricing, or reporting practices fail to match reality.
For investors and asset managers, the key considerations include:
• Reputational and regulatory risk are material
Allegations of misleading conduct in a regulated sector highlight the financial and reputational risks companies face when governance standards fall short.
• Pricing and disclosure transparency
Just as insurers must ensure premiums and renewal comparisons are accurate, asset managers must align marketing, disclosures, and fund documentation with actual practice.
• Regulators are expanding their scrutiny
ASIC’s action is part of a broader global trend of tougher enforcement against misleading or overstated claims across industries.
• Data integrity underpins trust
Whether in insurance premiums or asset management reporting, investors and regulators expect reliable, auditable, and consistent information.
Key Takeaways
• Regularly audit marketing, reporting, and disclosure materials to confirm consistency with internal practice.
• Recognise that regulators globally are intensifying oversight - enforcement actions in the US and Germany, alongside heightened scrutiny in the UK and Hong Kong, all point to the same direction of travel.
• Establish formal, documented ESG policies and ensure they align with all external communications.
• Support all ESG claims with transparent, reliable, and auditable data.
How Integrum ESG helps asset managers avoid greenwashing
At Integrum ESG, we equip investors with the data and intelligence needed to identify red flags early.
Our Platform provides transparent, credible and auditable ESG analytics that highlight governance, conduct, and compliance risks before they escalate into controversies.
By monitoring corporate behaviour in real time and flagging weak practices in areas including selling, marketing and disclosure, we help investors avoid exposure to reputational damage, regulatory penalties and value erosion in their portfolios.
ESG Intelligence which is fast, transparent and affordable - only on the Integrum Platform.