The Federal Government has signalled it will give priority to reintroducing the legislation underpinning the Life Insurance Framework (LIF), but taking into account submissions from industry stakeholders with respect to the final regulations.
The Minister for Revenue and Financial Services, Kelly O’Dwyer, used her address to the Financial Services Council (FSC) Leader’s Summit in Melbourne this week to outline the Government’s thinking on the LIF changes.
She said that while the Government knew the majority of people working in the sector did the right thing, the problems needed to be addressed if the sector was to grow and consumers were to receive the right advice.
“A number of recent inquiries and reports have made recommendations to improve the quality of life insurance advice — including a report by ASIC, the industry-commissioned Trowbridge Review and the Financial System Inquiry,” O’Dwyer said.
“And in response to these reviews the Government has worked with key industry stakeholders to introduce a package of reforms that better align the interests of advisers and consumers.”
“Now, as you’re no doubt aware, the legislation was before the Senate when the election was called. Consultation had also started on regulations to support the legislation. With that in mind, the Government will now work through the recommendations made in submissions.”
“I want to reiterate that the life insurance advice reform package remains a priority for the Government and I intend to work closely with stakeholders to ensure its passage through the Parliament,” the Minister said.
O’Dwyer also noted that the Australian Securities and Investments Commission (ASIC) was currently investigating the issues that were raised in relation to CommInsure.
“ASIC will also consider whether the matters raised in that report are indicative of systemic problems across the life insurance sector that need to be addressed,” she said. “The Government will carefully consider the findings of ASIC’s investigation.”
