The Association of Financial Advisers (AFA) has acknowledged AMP Limited as having demonstrated leadership by moving ahead of the industry on the Trowbridge recommendations and implementing changes to its remuneration structures.
However AFA chief executive, Brad Fox, said he would have preferred that the industry could have reached a unified position.
“AMP has taken a step in the right direction, but we are dealing with a highly complex area and we would have preferred a unified position,” he said.
The AMP move, announced late yesterday, is expected to be the precursor to similar announcements by other major players in the insurance space, but certainly not all participants.
AMP announced that it would be reducing upfront commissions on new life insurance products, capping year one commissions to 80 per cent and a 20 per cent annual commission payment.
As well, it said AMP advisers would have access to the one year commission only once every five years per policy, and that it’s licensees’ approved product lists would move to a similar remuneration structure with all life insurance products complying with the new model and the five year rule.
Confirming the changes, AMP chief executive, Craig Meller, said AMP would support advisers through the transition and was committed to developing technology and systems which allowed advice to be delivered more efficiently.”
