The Financial Services Council's (FSC) new Life Insurance Code of Practice is facing delays from its original deadline of 1 July 2016, and will now commence in October.
The FSC said that while the original timetable allowed the 12-month period up to 1 July 2017 open for insurers to transition to the code, the transition period would now be reduced so all insurers would still be compliant with the code standards by 1 July, 2017.
The group also said it decided it would require the additional three months following consultation with stakeholders including consumer groups.
"After consulting with consumer groups, the FSC has identified areas where the code's standards could be further developed — in particular, focusing on sales practices and claims handling," it said.
The FSC announced key changes to the code of practice in March following allegations levelled at CommInsure. Chief executive, Sally Loane, acknowledged the criticism that the life insurance industry could not self-regulate.
The Australian Securities and Investments Commission (ASIC) deputy chair, Peter Kell, told the Life Insurance conference that there was a life insurance code previously but it failed due to lack of commitment underpinning it. He said it was vital to get appropriate consultation.
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