Will Quality of Advice Improve Under LIF?

Will the Life Insurance Framework reforms deliver higher quality standards of life insurance advice to the consumer?

  • No (84%)
  • Yes (10%)
  • Not sure (7%)

Our latest poll follows a recent statement made by the regulator that it expects the quality of advice relating to life insurance to be enhanced as a result of the implementation of the Life Insurance Framework reforms.

In a formal reply submitted by ASIC to questions put to it by the Parliamentary Joint Committee Inquiry into Life Insurance, the regulator made a number of observations regarding trends it sees in retail (advised) life insurance and the impact of the FoFA reforms on the life insurance sector (see: Life Insurance Behaviour Unchanged…). One of its obeservations was that it expects the quality of life risk advice to improve from 1 January 2018 following the commencement of commission capping and new clawback arrangements.

Do you agree with ASIC’s assessment?

This is not a poll on whether you agree with the Life Insurance Framework reforms. We’re asking whether you think the reforms will lead to better quality life insurance advice.

The focus for ASIC has always been around improving the quality of advice; not on churning. Its recent statements serve to confirm this approach. In the regulator’s view, and in the view of the Government, consumer groups and other stakeholders, there is a definite upside for the consumer once the effects of the reforms begin to ripple across the sector from its starting point of 1 January 2018.

On the flip-side, others within the industry, including many advisers, have stated with conviction that there will be no outcome in the reforms that will benefit the consumer.

Where do you stand on this question? Again, this is not about whether you support the LIF reforms but whether you think the effects of the reforms will deliver better quality life insurance advice.

We look forward to your vote and welcome your measured comments on this question…