ClearView Financial Advice has paid $730,000 in compensation to 215 clients who received poor life insurance advice due to ‘needs analysis’ failings, the corporate watchdog has announced.
In an announcement, the Australian Securities and Investments Commission said another 21 clients received non-financial remediation through reissued advice documents and fee disclosure.
ASIC said it received 4,269 advice files which highlighted areas of concern such as inadequate needs analysis for clients, insufficient explanation about the pros and cons of using superannuation to fund insurance premiums, inadequate consideration of premium affordability issues and poor disclosure about replacement products.
The watchdog also raised concerns related to the conduct of ClearView adviser Jason Churchill who accepted an enforceable undertaking in 2016. Churchill agreed to undergo additional training, adhere to strict supervision requirements and had each piece of his advice audited by his authorising licensee before it was provided to clients.
ClearView also reviewed previous advice given by Churchill and remediated clients who received inappropriate advice.
The firm also reviewed personal insurance advice to determine if there was a systemic issue related to the concern areas identified by ASIC. Deloitte was used to provide oversight on the review and found a number of ClearView advisers did not undertake adequate ‘needs analysis’ for clients
“The needs analysis is a critical part of the financial advice process. It enables advisers to understand their clients’ financial situation, needs and objectives, and provides the basis for the financial advice,” ASIC said.
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look what happens when you offer shares to advisers.... surprised thats all they found
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