MR No. 2020 – 5
7 April 2020
The Financial Markets Authority (FMA) is warning people about misleading claims that they need health insurance to cover emergency medical bills for COVID-19.
Last week the FMA successfully requested the removal of two advertorials a financial adviser had posted on Chinese-language social media platform, WeChat.
The posts, written like news articles, cited costs for COVID-19 hospitalisations in China – supposedly up to NZ$250,000 – before recommending people living in New Zealand get health insurance to avoid the same financial risk, especially young children and the elderly.
The advertorials failed to mention that in New Zealand, emergency treatment and testing for COVID-19 is free, as it is covered by the public health system. The Ministry of Health says anyone with an infectious disease is eligible for publicly-funded health services. Citizenship and immigration status are not relevant, nor is their length of stay in New Zealand.
After being tipped off by a concerned party, the FMA contacted the adviser’s office and they agreed to remove the COVID-19 advertorials. The FMA is following up with the advice firm in question.
FMA Director of Regulation, Liam Mason said whether intentional or not, the posts would have misled readers into believing they need insurance for COVID-19 testing and urgent treatment, when they don’t.
“All advisers, in particular registered financial advisers, need to remember their fair-dealing obligations under the Financial Markets Conduct Act. These provisions prohibit misleading or deceptive conduct, including false or misleading advertisements.
“We continue to talk with financial service providers to ensure they devote their efforts to helping their customers through this incredibly difficult period. We want providers to engage openly and honestly with customers in all interactions,” Mr Mason said.
“The FMA will not tolerate behaviour from firms or individuals that appears to exploit the COVID-19 disruption, or conduct that preys on people who may be feeling additional stress at this time. We will take any steps necessary to stop this kind of behaviour and hold those responsible to account.”
Anyone with information about suspicious offers of insurance or investments related to COVID-19 are urged to pass it on to the FMA, by emailing firstname.lastname@example.org
Senior Adviser, Media Relations
021 945 323