Insurer asks staff to 'show me the money'

Freedom Insurance has asked its sales staff to "show me the money", accompanied by an image of Tom Cruise saying the famous movie line, and offered trips to Bali to aggressively drive sales.

Sell, sell, sell has been the call to sales agents through incentive programs promising holidays in Bali, a cruise around Sydney Harbour and Vespa scooters as prizes.

One of the 2017 and 2018 campaigns drew on Cruise's 1996 film Jerry Maguire and his classic line "show me the money!".

Freedom chief operating officer Craig Orton said the campaign, offering $100 in prize money for selling funeral insurance, was absolutely inappropriate.

"That will not happen under my watch," he told the banking royal commission on Tuesday.

Mr Orton agreed the incentive campaign was likely to drive highly aggressive and inappropriate sales practices so people could meet their targets and be eligible for the money.

Another campaign, which used a photo of American rapper 50 Cent holding a stack of cash, offered $150 for a team to "smash 400 lives" insured by lunchtime.

Mr Orton, who joined Freedom in February, said he was livid about the campaigns.

"I don't believe in these sorts of incentives," he said.

"I don't believe in commissions that are sales or retention driven."

Freedom is scrapping commissions for its sales agents, accepting it has created incentives for them to aggressively pursue sales.

The remuneration structure has also been linked to the mis-selling of life insurance to vulnerable customers.

A woman complained in April this year about her mother being sold a policy that insured 29 people.

Mr Orton said there was no indication on the sales call that the woman was vulnerable and the customer was asked if the policy was affordable.

"But regardless of that, I'm not justifying it because no one should ever have 29 people put on their policy," he said.

Mr Orton agreed the sales agent maximised their commission by getting additional lives on the policy.

Freedom will stop selling some types of insurance through cold calls amid pressure from the regulator.

But it will still use cold calls to sell its biggest money-earner, funeral insurance, which accounts for 85 per cent of its business.

It will continue selling accidental death cover, but not through cold calls, despite the Australian Securities and Investments Commission demanding insurers ditch the low-value policy.

Senior counsel assisting the royal commission Rowena Orr QC said Freedom sold tens of thousands of accidental death policies annually and received no more than 22 claims a year.

The commission heard Freedom sold insurance including accidental death cover over the phone to an intellectually disabled Melbourne man with Down syndrome, who did not understand what he was buying.

The inquiry heard another ASX-listed company, ClearView, planned to offer staff a trip to Queenstown as a prize amid a frenzied sales push despite knowing it breached the law.

ClearView's chief actuary and risk officer Greg Martin declared the November 2016 promotion would be "over my dead body" and it did not proceed.

ClearView shut down the direct sales business last year.

Australian Associated Press