Powered by MOMENTUM MEDIA
moneymanagement logo
 
 

FSC direct insurance carve-out calls condemned

AFA/FSC/LIF/

22 June 2016
| By Malavika |
image
image image
expand image

The Association of Financial Advisers (AFA) is looking to close the loophole that allows a carve-out for direct insurance sales that excludes it from the Life Insurance Framework (LIF), and has refuted the Financial Services Council's (FSC's) continued calls to seek a carve-out.

In a letter to members this week, AFA president, Deborah Kent, said that disappointingly, the FSC was continuing to campaign for a carve-out despite the Minister agreeing that there would be no carve-out for direct sales channels in November 2015.

In its feedback on the Exposure Draft Legislation and Explanatory Memorandum for the Corporations Amendment (Life Insurance Remuneration Arrangements) Bill 2015, the FSC stated in its submission to the Treasury in December 2015 that more consultation was required to avoid unintended outcomes on direct life insurance distribution models.

"We see this behaviour from the FSC as unacceptable given the thoroughness of the negotiations and that the Minister had already publicly confirmed that LIF would apply to direct insurance," Kent said in the letter.

She said the AFA Board wanted to see this loophole closed before legislation and regulation was put into effect by the next government.

Kent reiterated the point made by others before her and warned advisers that none of the major parties had indicated that the LIF outcome would favour them more than the current form of LIF.

"Depending on which party forms power after the election, LIF may continue substantially in its current form, or it may not," she said.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

The succession dilemma is more than just a matter of commitments.This isn’t simply about younger vs. older advisers. It’...

2 days 18 hours ago

Significant ethical issues there. If a relationship is in the process of breaking down then both parties are likely to b...

3 weeks 6 days ago

It's not licensees not putting them on, it's small businesses (that are licensed) that cannot afford to put them on. The...

1 month ago

After last month’s surprise hold, the Reserve Bank of Australia has announced its latest interest rate decision....

4 weeks 1 day ago

ASIC has released the results of the latest adviser exam, with August’s pass mark improving on the sitting from a year ago. ...

5 days 12 hours ago

While the profession continues to see consolidation at the top, Adviser Ratings has compared the business models of Insignia and Entireti and how they are shaping the pro...

2 weeks ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND