Woolworths Limited has been forced to change an ad for its car insurance after the Australian Securities and Investments Commission ruled it was "potentially misleading". The ads for Woolworths' Car Insurance appeared online and across out-of-home and transit in the second half of last year and into the beginning of this year.
They claimed "on average, our customers saved $240", which was based on a sample of 109 consumers who bought a comprehensive car insurance policy from Woolworths between 6 August and 30 September 2012. It compared the cost of the new Woolworths premium with the amount they had paid for their previous policy.
ASIC claimed the comparison could be misleading because of the differences between the two policies, in particular, the agreed value of potential customers' cars. The two units could therefore not be compared on price or savings.
While the ads included a disclaimer stating the cover and benefits may differ between the policies being compared, ASIC ruled it wasn't "sufficiently prominent to effectively qualify the savings claim" and was "unlikely to correct any misleading impressions created by viewing the savings claim".
ASIC deputy chairman Peter Kell said: "When comparing products in an ad, the products should have sufficiently similar features to make the comparison relevant and not misleading. The more that a qualification is required to balance the information contained in the headline claim, the clearer and more prominently placed the qualification should be."
Other companies to alter potentially misleading advertising as a result of ASIC determinations include GE Money, RAMS, Bankwest, HSBC and Commonwealth Bank.
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