ASIC wants common insurance language
The Australian Securities and Investments Commission (ASIC) has made clear it believes it needs more powers to deal with the insurance sector in circumstances where “sector specific” legislation has not been enough.
ASIC deputy chair, Peter Kell has told the Joint Parliamentary Committee on Corporations and Financial Services that the regulator believed changes needed to be made to the Corporations Act to allow ASIC to deal with a range of insurance issues, including claims handling.
Kell and other senior ASIC officers told the Parliamentary Committee that ASIC had been limited in the actions it could take with respect to insurance because of the nature in which the legislation had been originally handled by the Parliament.
At the same time, the regulator revealed just how far it was wanting the life insurance industry to move with respect to using common language across the industry.
Kell said ASIC had commenced a major project with the Australian Prudential Regulation Authority (APRA) with one of the major issues being considered within that project being common categorisation of terminology around what was actually meant by terms such as “declined” at claims time.
“It represents a very significant priority for ourselves and APRA,” he said.
Asked to explain the objectives of the project, Kell said a key audience for the resultant data would be consumers and that one of the objectives was to help all stakeholders make better decisions.
Recommended for you
Policy and advocacy specialist Benjamin Marshan has left the Council of Australian Life Insurers after less than a year, having joined in March from the Financial Planning Association of Australia.
The declining volume of risk advisers meant KPMG has found a rising lapse rate for insurance policies arranged by independent financial advisers, particularly in the TPD and death cover space.
The Life Insurance Code of Practice has transferred from the Financial Services Council to the Council of Australian Life Insurers.
The firm has announced it will no longer be writing new life insurance policies in the retail advised and corporate group insurance channels, citing a declining market and risk adviser numbers.
