Financial company ClearView admits it committed criminal offences by making 300,000 unsolicited cold calls to sell life insurance, as part of aggressive tactics designed to get as many sales as possible.
At one stage its pushy sales staff could make up to $8000 a fortnight in bonuses for greatly exceeding their targets, the banking royal commission heard.
ClearView also targeted poor people with emotional pitches to sell them low-value life insurance products, before shutting down its problematic direct sales business.
The ASX-listed company has admitting breaching anti-hawking laws, which is a criminal offence, between 300,000 and 303,000 times over a three-year period.
Most of the calls were based on customer information from its alliance partner, health insurer Bupa, while ClearView also bought consumer data from marketing companies.
The company did not understand it was breaching anti-hawking rules at the time, its chief actuary and risk officer Greg Martin said.
"We just got that wrong. We made a mistake."
ClearView has stopped selling life insurance directly to consumers after the Australian Securities and Investments Commission raised the anti-hawking issues and concerns about sales agents using unfair, high pressure and manipulative tactics.
Mr Martin said the remuneration for agents selling life insurance direct to consumers contributed to the inappropriate behaviour.
The inquiry heard that from 2013 to August 2014, a sales person who achieved 250 per cent of their targets could get an $8000 commission for that fortnight.
Mr Martin agreed that was incentivising aggressive sales tactics to make as many sales as possible at whatever cost.
The inquiry heard ClearView Direct targeted poor - or poorer on Mr Martin's description - people from a lower socio-economic demographic by trying to illicit an emotional reaction.
While sales staff were expected to follow company scripts, some also used unauthorised methods at the end of calls.
The partner close suggested: "Hand on your heart, will your partner object to the wonderful gift that you chose to give them in the event that you were not around to take care of them any more?"
Mr Martin said they were classic cornering sales techniques and were inappropriate.
"I was just appalled by them," he said.
Mr Martin said if ClearView had its time again it would not have had a direct sales business.
ClearView is refunding $1.5 million to around 16,000 consumers over its direct sales practices, but the remediation is expected to ultimately cover 32,000 life insurance policies sold between 2014 and mid-2017.
ASIC plans to restrict the practice of cold calls pressuring people to buy life and funeral insurance they don't want or can't afford.
It has also demanded insurers including ClearView stop selling accidental death insurance altogether, saying it is of little value.
The banking royal commission was told on Day one of its insurance hearing that Australia's 10 largest life insurers have paid more than $6 billion in commissions over five years to get financial advisers to recommend their products.
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