A group of life insurance advisers representing small businesses has lashed out against the Financial Services Council's (FSC's) stance on level commissions in the life insurance framework (LIF), arguing the FSC and the big banks have undue influence on the LIF debate.
In response to a recent Money Management story, which outlined FSC's support to move to level commissions and fee-for-service arrangements if the LIF did not meet its objectives, the Life Insurance Customer Group (LICG) has argued it would be consumers who would be worse off under the FSC's proposals.
"The LICG is urging the FSC to adopt a position that will place the interests of the consumer above self-interest," the group said.
"The LICG has repeatedly called on the FSC for evidence to back up claims that consumers will benefit from the proposals. To date the FSC has not responded with a reasoned reply."
The group, which has more than 2,300 signatories to its online petition against LIF in its current form, also urged all stakeholders to abandon self-interest and aim to close the underinsurance gap, and called on the FSC to prioritise consumers.
The group also said there was substantial concern that the FSC and the big banks were employing undue influence on Government and key stakeholders in the LIF debate.
"The FSC proposals will result in alarming competitive advantage being gifted to the big banks and FSC members," the group said.
"The LIF is a complex issue that has implications for many stakeholders, foremost the consumer."