ASIC issues relief on FSG and PDS delivery timeframes
The inability of Australia Post to guarantee on-time mail deliveries mean that the Australian Securities and Investments Commission (ASIC) has granted relief to insurers with respect to the requirement to deliver financial services guides and product disclosure statements to clients within five working days.
ASIC has written to insurers informing that because Australia Post was last year allowed temporary relief with respect to its performance standards on delivery standards until 30 June, this year, it will be giving similar relief with respect to the normal timeframes imposed on insurers.
ASIC has granted the relief in response to a request filed by the Insurance Council of Australia (ICA) which is representative of the major general insurers but the same rules will apply to life insurers.
The formal ASIC letter said the regulator did not intend to take action against a regulated person for breaching the following provisions where the breach was due to the effect of the postal standards relief:
- Section 941D of the Corporations Act – the requirement to provide a financial services guide within five business days of advice being provided in time-critical circumstances;
- Section 1012G of the Corporations Act – the requirement to provide a product disclosure statement (PDS) within five business days of a product being issued in time-critical circumstances; and
- Regulation 7.9.15C(5)(b)(i) of the Corporations Regulations – the requirement to provide a document containing dollar disclosure within five business days of a general insurance product being issued.
The letter said ASIC’s no-action position will cease when the postal standards relief expires.
In return, ASIC is insisting that the general insurers extend the five-day cooling off period by a further five days and inform consumers of that extension.
Recommended for you
Government has introduced a bill to Parliament to legislate the first stream of the QAR reforms.
ASIC now has a 1:1 ratio when it comes to court success in the enforcement of crypto activities and more action is expected as Treasury seeks to introduce a regulatory framework.
A leading governance body has hit out at “specialist interest groups proposing ad hoc law reform” when it comes to reforms of financial services legislation and believes an independent body is needed.
The release of ALRC’s final report into financial services legislation has highlighted financial advice as a “significant” focus as it seeks to reduce costs and help advisers understand their obligations, alongside the Quality of Advice Review.
