‘Sanity prevails’ with scrapping of LICD Bill

The unpopular Life Insurance Conduct and Disclosure (LICD) Bill has been scrapped by the Federal Government.

The Bill, which the life insurance industry has been fighting since its inception several years ago, will be replaced by CLERP 6 legislation recently unveiled by Federal Financial Services Minister Joe Hockey.

Both the Financial Planning Association (FPA) and the Association of Financial Advisers (AFA) welcomed the decision.

AFA president John Hibberd hailed the scrapping of the Billl as a vindication of an "extensive lobbying campaign" spearheaded by the Association which included the mailing of 170 letters to Senator Ian Campbell.

"We are pleased that sanity has finally prevailed at the government level. Our campaign was aimed at the stupidity of having two bits of legislation dealing with the same issue," he says.

FPA general manager of policy and professional standards Ken Breakspear says the more unpopular measures of the LICD Bill relating to disclosure of commissions by life advisers will come under the CLERP 6 banner.

Far from being a win for the life industry, Breakspear says the move to scrap the LICD Bill was arrived at for more pragmatic reasons.

"The LICD Bill was just very inefficient and potentially expensive to implement for the six to 12 months before CLERP 6 was introduced," he says.

Both Hibberd and Breakspear say their respective organisations support the measures to be introduced in CLERP 6.

Breakspear says it will provide the means through which life agents will be brought in line with financial planners in disclosure matters.

"CLERP 6 provides a wide framework. We look forward to getting to the stage of putting more meat on the bone," Breakspear says.