Financial services reforms should not apply to insurance industry: NIBA
The National Insurance Brokers Association (NIBA) has warned that any changes to licensing arrangements or regulation as a result of financial services reforms should not be automatically applied to the insurance industry, according to a submission to the Joint Parliamentary Inquiry into financial services and products.
There is no evidence that a change in insurance licensing is warranted as a result of the failure of some managed investment products, and regulatory changes to overcome recent managed investment scheme collapses would be inappropriate for insurance brokers, the submission stated.
“NIBA would be most concerned if solutions to perceived problems with managed investment schemes or advice given to the public about such schemes were to be automatically applied to risk insurance products,” they added.
NIBA reminded the inquiry that an Australian Securities and Investments Commission investigation into compliance and remuneration in 2005 did not find any evidence of abuse of remuneration systems, including recommending insurance products based on the size of commissions.
Recommended for you
Policy and advocacy specialist Benjamin Marshan has left the Council of Australian Life Insurers after less than a year, having joined in March from the Financial Planning Association of Australia.
The declining volume of risk advisers meant KPMG has found a rising lapse rate for insurance policies arranged by independent financial advisers, particularly in the TPD and death cover space.
The Life Insurance Code of Practice has transferred from the Financial Services Council to the Council of Australian Life Insurers.
The firm has announced it will no longer be writing new life insurance policies in the retail advised and corporate group insurance channels, citing a declining market and risk adviser numbers.
