The Full Federal Court has dismissed the Australian Securities & Investments Commission’s appeal against an earlier Federal Court ruling that a pre-existing condition term used in certain HCF Life insurance products was not an unfair contract term. The decision leaves intact the separate finding that the term was liable to mislead the public. ASIC said it is considering the decision. ASIC brought the appeal to clarify how the unfair contract terms regime applies to insurance contract terms that may also be affected by other statutory protections, and because it was concerned that the same term had been found liable to mislead the public but not unfair. The term appeared in product disclosure statements for HCF Life’s Recover range, including Cash Back, Smart Term and Income Assist. HCF Life replaced the term on 9 November 2023, and ASIC does not consider the replacement term to be misleading or unfair. After the liability ruling, HCF Life notified affected current and former policyholders and published a corrective notice, and on 8 May 2025 the Federal Court imposed an AUD 750,000 penalty for including the misleading term in those policies.
Australian Securities & Investments Commission2026-06-19
Australian Securities & Investments Commission loses appeal on HCF Life pre-existing condition term while misleading finding stands
The Full Federal Court dismissed ASIC’s appeal over a Federal Court ruling that HCF Life’s pre-existing condition term was not an unfair contract term. The separate finding that the term was liable to mislead the public remains in place, and ASIC is considering the decision.