People who held policies with collapsed insurer Youpla as of April 1, 2020, will receive payouts for funeral expenses.
The federal government announced on Monday that as many as 500 people impacted by the collapse will get access to payments in line with the cover eligible policy holders took out in good faith prior to Youpla Group's collapse, typically worth around $8000.
The arrangements will be in place until November 30, 2023.
"These are interim arrangements the government intends to establish while it investigates what further steps are required to bring resolution in relation to the Youpla Group collapse," Assistant Treasurer Stephen Jones said.
"The government will continue consulting widely on those further steps while these interim arrangements are in place."
Mr Jones said the first priority was to limit the immediate cultural damage and community grief Youpla Group's liquidation had brought about
People affected can register on the Treasury website.
Indigenous Australians Minister Linda Burney said "Sorry Business" is of the deepest cultural importance to First Nations people.
"It is vital that traditional mourning practices be allowed to continue despite the collapse of the Youpla Group funeral contribution funds earlier this year," she said.
The decision came after a campaign by the Save Sorry Business coalition, a group of more than 125 organisations.
Aboriginal Community Benefit Fund, which traded as Youpla, sold junk funeral plans to Aboriginal and Torres Strait Islander people across Australia for decades before coming to the attention of the banking royal commission and regulators.
The Australian Securities and Investments Commission had been investigating Youpla and its group of funeral contribution funds since the collapse.
Australian Associated Press
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