I, Rhys Bollen, delegate of the Australian Securities and Investments Commission, make the following legislative instrument.

Date    8 February 2022

Contents

Part 1—Preliminary  3

1    Name of legislative instrument 3

2    Commencement 3

3    Authority. 3

4    Definitions. 3

Part 2—Exemption  4

5    Timing for giving a Cash Settlement Fact Sheet—immediate need. 4

Part 3—Repeal 5

6    Repeal 5

Part 1—Preliminary

1        Name of legislative instrument

This is the ASIC Corporations (Cash Settlement Fact Sheet) Instrument 2022/59.

2        Commencement

This instrument commences on the day after it is registered on the Federal Register of Legislation.

Note:    The register may be accessed at www.legislation.gov.au.

3        Authority

This instrument is made under paragraph 951B(1)(a) of the Corporations Act 2001.

4        Definitions

In this instrument:

Act means the Corporations Act 2001.

providing entity has the same meaning as in section 948B of the Act.

Part 2—Exemption

5        Timing for giving a Cash Settlement Fact Sheet—immediate need

(1)     A providing entity does not have to comply with subsection 948C(1) of the Act to the extent it requires the providing entity to give a Cash Settlement Fact Sheet at the time specified in section 948D of the Act.

(2)     The exemption in subsection (1) applies in relation to an offer (cash settlement offer) made by the providing entity to a client to settle all or part of a claim under a general insurance product using a cash payment where all of the following apply:

(a)     the client has expressly instructed the providing entity that the client is in immediate need of a cash payment because of the insurable event the subject of the claim;

(b)     the cash settlement offer has been made verbally (verbal cash settlement offer) to the client no later than 14 days after the insurable event the subject of the claim;

(c)     the total of the following does not exceed $5,000:

(i)      the amount of the cash settlement offer;

(ii)     the amount of any other cash settlement offers made to the client by the providing entity in relation to the insurable event in accordance with paragraphs (a) and (b) that either:

(A)    have been accepted; or

(B)    remain capable of being accepted.

Conditions

(3)     The providing entity must:

(a)     verbally give the client the information and statements specified in subsection 948F(1) at the time the verbal cash settlement offer is made; and

(b)     take all reasonable steps to give the client a Cash Settlement Fact Sheet within:

(i)         48 hours of the verbal cash settlement offer being made if the Cash Settlement Fact Sheet is given electronically; or

(ii)        5 business days of the verbal cash settlement offer being made if the client has notified the providing entity they cannot or do not want to be given the Cash Settlement Fact Sheet electronically; and

(c)     take all reasonable steps to make the cash payment within 2 days of the client accepting the verbal cash settlement offer; and

(d)     provide the client with the right to have the accepted cash settlement offer reversed (right of reversal) on terms that include the following:

(i)   the client may exercise the right of reversal up to 12 months after the date the cash payment was made;

(ii)  no interest or fees on the amount of the cash payment are payable by the client.

Note:    Paragraph (d) does not limit any rights of review available to the client in relation to the insurance product.

Part 3—Repeal

6        Repeal

This instrument is repealed on the day that is 3 years after the day it is made.