Individual adviser registration may spell an end to licensees having to source professional indemnity (PI) insurance, according to the chair of Synchron, Michael Harrison.
Writing in a column to be published in Money Management, Harrison listed the provision of PI insurance as a function he foresees licensees will not perform, because he believes PI provision would be part of the adviser registration process.
“The functions I foresee that licensees will not perform, will be registering advisers (which they don’t technically do now anyway, the Australian Securities and Investments Commission does), monitoring the adviser’s behaviour in relation to the code (although they will still be responsible for ensuring compliance) and sourcing professional indemnity insurance (a welcome relief),” Harrison wrote.
“However, licensees will also have to ensure that they remain relevant,” he said and noted that manner in which his own dealer group had been enhancing its software capabilities, increasing its staff training and adding resources to its compliance team.
“I think we will also have a larger role to play in helping to move the profession as a whole forward by offering advisers the kinds of services they need to cater for the disparate types of consumers in the marketplace,” Harrison said.
He said there seemed a likelihood that individual adviser registration would be likely to reduce regulatory costs simply by reducing the level of regulation.