The statement of claim, filed in the Victorian Supreme Court, accuses NRMA Insurance of “engaging in misleading and deceptive conduct as well as unconscionable conduct” relating to the pricing of the insurer’s home and contents policies, a statement from the law firm explains.

Slater and Gordon claim the policies of concern were issued by Insurance Australia Limited (IAL), which operates NRMA Insurance, under its parent company Insurance Australia Group (IAG), as part of a campaign titled “Get Your Insurance Back”.

IAG maintains the insurance company delivered on loyalty promises and intends to defend against the class action.

"IAG has been served by Slater and Gordon with a statement of claim for a policyholder class action in the Supreme Court of Victoria against IAG’s subsidiary Insurance Australia Limited (IAL). IAL will defend these proceedings," A statement from the company reads.

“This class action follows the class action proceedings commenced by the same law firm in May 2024, which IAL and IMA are also defending, and relates to loyalty offers for NRMA Insurance home, contents and home and contents insurance policies.

"IAL and IMA maintain they have delivered on loyalty offers made to customers and do not agree that they have misled customers about the extent of the discounts they would receive."

The class action claims that the insurance company misled customers by leading them to believe they were receiving loyalty discounts upon renewal, without disclosing that these discounts could be undermined by a "loyalty tax" present in the customer's base premium. 

Ben Hardwick, Leader of Slater and Gordon's Class Actions Practice Group, said the insurer utilised algorithm technology to identify consumers who were least likely to switch to a different company if premiums were to increase.

The base premium for customers deemed least likely to switch insurers was then raised, the law firm has claimed.  

“We’re alleging that millions of Australians paid premiums year-on-year for NRMA home insurance on the promise that they were getting a discount. But in reality, because of this pricing algorithm, long-term customers were unknowingly paying extra in the form of higher base premiums," Mr Hardwick said.

“Customers are sick of being taken advantage of by big businesses and insurers, so through this group proceedings, consumers are demanding to be compensated for the loss and damages we say they have suffered as a result of IAL’s conduct.

“This class action alleges that these customers were denied all relevant information they should have had access to before they renewed their home and contents policies so they could have made an informed choice about whether to shop around for a better deal, or at the very least ask for a better price."

Mr Hardwick said customers were likely to have received cheaper insurance from other brands had they not been swayed by loyalty discounts that were not being factored into their renewal calculations. 

“We consider that this conduct may amount to misleading and deceptive conduct and unconscionable conduct, in breach of the ASIC Act.”

The legal pursuit has been issued on a No Win-No Fee basis and group members will not be exposed to any out-of-pocket costs as a result of their participation in the class action.