Life/risk adviser group demands answers
A group established by life/risk advisers, the Life Insurance Customer Group (LICG), claims it is still waiting for a response from the Financial Services Council (FSC) to claims that FSC members have been failing to adhere to the FSC's Code of Ethics and Code of Conduct.
The LICG wrote to the FSC in late April raising concerns about the reported behaviour of the major institutions which are members of the FSC and suggested that it is those reports about financial services product providers which have been tainting the reputation of the broader financial services industry, particularly advisers.
The letter was written at the same time as a number of life/risk advisers continued to argue strongly against the terms of the Life Insurance Framework (LIF).
The letter to the FSC describe the LICG as "a group of life insurance-focussed advisers" and states that "ordinarily, matters relating to the FSC and members with a focus outside life insurance would not be of sufficient significance for us to comment on".
However it then claims that, "many consumers find it difficult to differentiate between the component services within the financial services sector (advice or product provision) for cash flow planning, lending, investments, insurance, etc., nor can they readily differentiate between advisers, or fully understand any allegiance some advisers may have with product providers".
"In this context all advisers are tainted with media reports on a failing in any of these areas," the letter said.
"In becoming tainted by the behaviour of others, and because of the unsubstantiated allegations of churn the FSC has made against advisers, we have become very interested in all matters relating to the values and behaviours of the FSC."
The letter went on to say that those making up the LICG were arguing "that the lack of clarity as to who exactly is perpetrating what breach, and the lack of industry policing and public reproach, has created the significant consumer mistrust of the financial services sector".
The letter claimed the FSC has been silent on the breaches perpetrated by its members and questioned why this had been the case and suggested the FSC had become disconnected from the insurance sector.
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