The Gold Coast funeral insurance firm, the Aboriginal Community Benefit Fund is the latest company to come under scrutiny as the banking royal commission looks at how financial services interact with indigenous communities.
An aboriginal man from Katherine who lost his daughter to suicide was initially refused a payout by the company despite paying premiums for 23 years, as they claimed the policy did not cover suicide.
Jemima McCaughan from NSW Legal Aid said she believed vulnerable people are being targeted for funeral insurance, citing examples of healthy 30 year old Aboriginal women and their children receiving funeral insurance, which Ms McCaughan claims is not a suitable product.
She said a suitability test would be beneficial in deciding whether the product was right for the person, as well as a cap on premiums over time.