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Target Market Determination (TMD)

Effective date of TMD: 25 August 2023
Version: 1.1

What’s a TMD?

A Target Market Determination or TMD is a document that describes which retail clients a product is likely to be appropriate for (aka the target market), and any rules around how the product can be distributed. It also describes the review and reporting processes we have in place, and reporting requirements that distributors need to follow.

This document isn’t a Product Disclosure Statement (PDS) or a summary of the terms and conditions or features of the product.  It doesn’t consider your personal objectives, financial situation or needs. Please head to getflip.com.au to learn more and read our PDS. 

In this document, ‘we’, ‘us’, ‘our’ and ‘HCF Life’ means HCF Life Insurance Company Pty Ltd, AFSL 236 806. HCF Life is the issuer of Flip Active. 

Key attributes 

Scope of cover

Flip Active provides cover under a group life insurance policy issued to Flip Insurance Pty Ltd (Flip Insurance). Cover is distributed by Flip Insurance to customers, who can purchase cover, either for themselves or for their child (insured person). 

Flip Active pays a cash benefit if an insured person has an accidental injury of a specified severity, as determined by a health professional.  Benefits range from $100 to $50,000 depending on the severity of the injury.  

An insured person can claim multiple benefits and/or accidents until they reach $50,000 in total payouts under this policy and any other accidental injury insurance product issued by us and distributed by Flip Insurance (Other Flip Policy). 

Cover can be: 

  • purchased for a day, a week or on an ongoing monthly basis; and
  • cancelled at any time.

Eligibility criteria

An individual can purchase cover if they:

  • are aged 18 to 64;
  • living in Australia; and 
  • have not received $50,000 in payouts under any Other Flip Policy.

A parent or legal guardian can purchase cover on behalf of their child if:

  • the child is aged 5 to 17; and
  • both the parent or legal guardian and the child are living in Australia; and
  • the child has not received $50,000 in payouts under any Other Flip Policy.

Cost of cover

There is no underwriting for this product.  The amount payable for cover depends on the duration of cover, which is:

  • $7 for a day of cover;
  • $25 for a week of cover; or
  • $40 for a month of cover.

Benefit limitations

  • To be eligible for a benefit the insured person must:
    • see a health professional within 14 days of the accident, and
    • have a health professional confirm that the accidental injury meets the required severity of injury within 6 months of the accident.
  • A benefit is not payable if the insured person is eligible for a benefit for the same accidental injury under any Other Flip Policy.
  • A benefit is not payable for any accidental injury that happens because of:
    • motorcycling;
    • paid work or employment, unless the paid work or employment is a sport-related activity such as tennis coaching;
    • any accident outside Australia and New Zealand;
    • something other than an accident, such as injuries that are sustained gradually through repetitive use over time e.g., tennis elbow;
    • taking illicit drugs or medication not as directed, or being under the influence of alcohol;
    • medical conditions, medical episodes, or by medical procedures or related complications;
    • intentionally causing self-injury or attempting suicide;
    • acts of war, whether declared or not, hostilities, civil commotion, terrorism or insurrection;
    • being involved in an illegal act; or
    • a dental injury caused by food or drink including any foreign object in the food or drink.

This is only a summary of key attributes, and it does not form part of the terms for this product. Please refer to the PDS for the terms and conditions for cover, including important definitions.

Target market 

Flip Active has been designed to be issued to Flip Insurance, for distribution to customers with the following objectives, financial situations and needs: 

Eligibility

If an individual is seeking cover for themselves, the individual must:

  • be aged 18 to 64;
  • be living in Australia; and 
  • have not received $50,000 in payouts under any Other Flip Policy; and

If a parent or legal guardian is seeking cover on behalf of their child:

  • the child must be aged 5 to 17; 
  • both the parent or legal guardian and the child must be living in Australia; and
  • the child must have not received $50,000 in payouts under any Other Flip Policy.

Objectives 

Looking for cover that will:

  • pay a  cash benefit if the insured person experiences an accidental injury of a specified severity; 
  • provide supplementary financial support instead of cover for all or a percentage of the actual expenses associated with the accidental injury; 
  • run for either a limited short-term period (days or weeks), or for an ongoing period of more than one month; and
  • involve a simple payment structure without underwriting.

Financial situation

Have the financial capacity to pay the premium in accordance with the chosen premium structure, for the duration over which cover is sought. 

Needs

Requires cover that provides a cash payout if the insured person suffers an accidental injury of a specified severity within the chosen cover period. 

Suitability of the target market

This product is likely to be consistent with the objectives, financial situation and needs of retail clients in the target market because:

  • the group life insurance policy has been specifically designed to be issued to Flip Insurance;
  • the target market includes customers whose objectives and needs are focused on cover that pays a cash benefit if the insured person suffers an accidental injury of a specified severity. Subject to only limited exceptions, Flip Active pays a cash benefit in similar circumstances, so it is likely to be consistent with the likely objectives and needs of retail clients who obtain cover; and
  • the target market includes customers who have the financial capacity to pay the premium in accordance with the chosen premium structure, for the duration over which cover is sought, and the product requires payment of that premium in accordance with that chosen premium structure. If a customer has the financial capacity to pay the premium, then it is likely to be consistent with their financial situation.

Distribution conditions

Any person who engages in retail product distribution conduct (distribution) in relation to this product must comply with the following requirements:

  • any promotional or advertising material must be approved by us as consistent with the target market;
  • cover can be obtained only through the website getflip.com.au, which must:
    • clearly and prominently explain key information about the scope, inclusions and exclusions of cover as part of the onboarding process; and
    • require the customer to choose a period of cover; and
  • the purchase process must include questions designed to determine whether the person is eligible for cover, and the process must not permit cover to be provided in circumstances where the customer would not satisfy the eligibility criteria cover for obtaining cover.

If cover is provided to a retail client in accordance with these distribution conditions, it is likely that the retail client would be in the target market. This is because: 

  • Flip Active has been specifically designed to be simple and easy to understand, with a fixed benefits and premium structure, no underwriting and limited exclusions; 
  • cover can be obtained only through the website getflip.com.au, which is required to clearly explain key information about the cover as part of the onboarding process, permit cover to be issued only if the insured person satisfies the eligibility criteria, and require the customer to select a period of cover; and
  • when considered in conjunction with the relatively simple terms for cover, this customer journey makes it likely that a customer would come to understand key information about the cover as part of the onboarding process. It also makes it likely that a customer would proceed with obtaining cover only if the cover would be consistent with their objectives, financial situation and needs. 

Reviewing this TMD and reporting obligations

We will review this TMD within one year of its effective date, and then every 2 years after the first review. We will also review this TMD earlier if a review trigger occurs.

Review trigger explanation Obligations
1. Regulatory environment The commencement of a significant change in law that materially affects product design and/or distribution of this product. We must monitor relevant regulation, legislation and/or ASIC instruments relating to the change in law, as required.
2. Product performance Product performance is materially inconsistent with our expectations having regard to:
– the number of times cover is sold, and the periods for which cover is sold;
– cancellation rates
– the product claims ratio;
– the number or rate of paid, denied, and withdrawn claims;
– the Net Promoter Score (NPS); or
– the number or rate of new and active customers.		 We must monitor product performance metrics on a quarterly basis against targets and expectations.
Distributors must report on these metrics on a monthly basis. This information must be shared with us within 10 business days of the end of the reporting period
3. Product changes Material changes in the product design or distribution which in our view could change:
– the target market; or
– the distribution conditions which will make the product more likely to be issued to customers who are within the target market.		 We must assess changes to product terms or distribution to determine if they trigger a review.
4. Product intervention powers ASIC’s use of its Product Intervention Powers in relation to the distribution or design of this product where we consider this reasonably suggests that this TMD is no longer appropriate. We must monitor the terms of any Product Intervention Order made or proposed to be made by ASIC which affects the product, as required.
5. Complaints Significant or unexpectedly high number of complaints regarding product design, claims, or distribution where we consider that this reasonably suggests that the TMD is no longer appropriate. Distributors must record all complaints relating to Flip cover and must report the following on a quarterly basis:
– the total number of complaints they received during the reporting period; and
– the nature and details of each complaint.
This information must be shared with us within 10 business days of the end of the reporting period.
6. Significant dealings We determine that a significant dealing in the product outside the target market (except for an excluded dealing) has occurred. Any dealing in the product to a person which we and/or our distributors become aware is not consistent with the TMD must be reported to us within 10 business days of becoming aware of the dealing.


Previous TMDs