Life Insurance Set For New Parliamentary Review

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The life insurance sector will come under renewed scrutiny after a call for a new Parliamentary inquiry was agreed to by both sides of politics in the Senate yesterday.

Nationals Senator for NSW, John Williams
Nationals Senator for NSW, John Williams

The call for the inquiry was made by Nationals Senator John Williams who asked that the Parliamentary Joint Committee on Corporations and Financial Services examine a range of issues and report by 30 June 2017.

Williams asked that the Committee look into the following matters:

  • The need for further reform and improved oversight of the life insurance industry
  • Assessment of relative benefits and risks to consumers of the different elements of the life insurance market, being direct insurance, group insurance and retail advised insurance
  • Whether entities are engaging in unethical practices to avoid meeting claims
  • The sales practices of life insurers and brokers, including the use of Approved Product Lists
  • The effectiveness of internal dispute resolution in life insurance
  • The roles of the Australian Securities and Investments Commission and the Australian Prudential Regulation Authority in reform and oversight of the industry
  • Any related matters

The move by Williams was heralded prior to the recent Federal Election when, in a statement supplied to the Association of Financial Advisers, he stated he would reactivate previous inquiries, including the long running Scrutiny of Financial Advice inquiry which was halted by the election.

William’s call for the inquiry was supported by the Federal Opposition with Senator Katy Gallagher, Shadow Minister for Small Business and Financial Services, stating it would support William’s motion to refer the issues to the Parliamentary Joint Committee

“Labor’s preference would be for the government to establish a royal commission into the banking and financial services sector that would put a stop to the scandals and misconduct and that would restore public confidence in Australia’s financial institutions. But we will support this motion because we believe these are significant issues that should be examined by this committee,” Gallagher said.



2 COMMENTS

  1. For both sides of politics to agree on the 14th September that a new Parliamentary inquiry is needed, is a step in the right direction.

    Nationals Senator John Williams, seems to have a much better grasp of what needs to be looked into.

    The determining factor on whether this inquiry will be a turning point for a better
    Life Insurance Industry, or a waste of time and money, is for the Parliamentary Joint Committee to first attain, what are the “real” issues, what “exactly” is to be discussed, why are those issues being looked into and who will be participating and formulating the questions to attain sufficient cause and effect, based on facts.

    The foundation of improving systems and processes, is to first recognise REAL
    problems, determine WHY they are problems, then calling upon specialists with REAL experience to come up with solutions.

    Based on the past experience, laying the foundation by attaining the REAL truth around perceived issues, will be the defining part of the process.

    If we allow the disgraceful actions of just one example, being the FSC, to be repeated with their self-interest agenda, then this inquiry will fail.

    The FSC should be ordered to back up their assertions with Facts. They have refused to answer questions and have treated the Government and all Australians with an
    arrogant indifference to reasonable requests for clarification.

    There are many noisy self-interested, lobby groups who rage against everything and
    have little to nil experience, though are allowed to be a distraction and who end up muddying the waters with their diatribes.

    It is in reality, a simple process for the committee. They have to use 3 words to cut
    through the miasma and get to the truth (What, Why and How)

    1) What is the problem.

    2) Why is this a problem.

    3) What proof do you have that this is a real problem.

    4) What do you propose, to fix it

    5) How do you propose, to fix it

    6) What experience do you have to fix it

    7) What is the verifiable action plan that clearly spells out in writing what is to be achieved.

    Unfortunately, to date we have had numerous inquiries that have led to many platitudes and promises of vague improvements to the consumer, with little to back it up.

    If the Government is serious about making the Life Insurance sector a continuing
    bedrock of society that encourages and demands all parties be accountable for their actions, then this latest inquiry needs to follow the 7 steps and start listening to REAL experts that have honesty and integrity as their founding principles.

    • Brilliantly laid out Jeremy – now we need Katy Gallagher, John Williams and other responsible ministers to acknowledge the situation as you have broken it down and follow an intelligent plan.

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