The ‘opt in’ provisions for continuing advice and professional indemnity insurance were just two of the key issues tabled at the Association of Financial Advisers (AFA) Leadership Licensee Forum this week.
Special guests included senior members of the Treasury team Geoff Miller and Richard Sandlant, who are engaged in the Future of Financial Advice reforms consultation process. AFA chief executive Richard Klipin said it was a good opportunity to understand the scope of the consultation and debate some of the key issues.
Klipin said there were about 40 attendees, representing licensees ranging from the very large to small. The key areas of debate were how the opt in provisions would work; how intra fund relief would be extended to advisers; the professional indemnity market and how to ensure comprehensive cover for businesses in the compensation fund area; and how to ensure insurance and underinsurance stayed on the radar.
The AFA also tabled consumer sentiment research that will be released next week.
“Tapping into consumer sentiment now is really important in terms of how we run the debate and ensure that advisers are meeting consumers’ needs,” said Klipin.
Miller and Sandlant did not comment on a recent speech made by Minister for Financial Services, Superannuation and Corporate Law, Chris Bowen, in which he said the opt in requirements may be extended for a further two years after July, 2012. Klipin warned that this was a consultation process and that people should not get too excited or panicked about what the Minister said.
“I think the central message that the AFA is trying to get out there is to stay calm, don’t panic, and carry on with what you’re doing. Because if everyone jumps at shadows and tries to second-guess everything, we’ll end up tying ourselves in knots and not actually getting the conversation verified down the track,” he said.
Peter Daly of the Australian Financial Services Group said the forum was an excellent opportunity to get involved in the consultation process. He said the next step would be various dealer groups preparing discussion papers to be sent to the AFA and the Financial Planning Association, which would focus on the practical elements of some of the discussion points and how they would work in practice.
“The focus at the moment seems to be on a number of ideas that are being tabled, but it’s the execution of the ideas that really is the critical aspect,” he said.
“It’s about the practicalities and making sure everyone understands the practicalities before you make some hard and fast rules.”
