The current sustainability issues being experienced by Australia’s life insurance industry have attracted the attention of the Federal Government, according to Assistant Treasurer, Senator Arthur Sinodinos.
Speaking at a Liberal Party event in Sydney last week, the Senator outlined the Government’s plans for 2014. Among them is a plan to consult with industry on the issues facing the life insurance sector.
“There are ongoing concerns held by industry, superannuation funds and now the government about the life insurance industry,” the Senator said. “My office has been actively speaking to all players and I have asked Treasury to develop a consultation process so that the many issues can be brought together in a coordinated approach and there can be a frank exchange of ideas with all stakeholders about what needs to be done to address pricing, availability and the deficiencies in the current life insurance market.”
In addition, Senator Sinodinos said he would shortly announce a process to look at the professional standards of financial advisers. “I envisage that this would include training, indemnity insurance and any proposed move to a national exam,” he said, adding that these issues needed to be examined as part of a considered process and not on an ad-hoc basis.
We have approached the Senator’s office for further comment on this issue, and hope to bring this to you shortly.
The comments follow the release of the highly-anticipated Future of Financial Advice legislation reforms for consultation (see: FoFA Changes – The Details).
Good to see that the Senator is moving on this matter. We need a sustainable market which is able to deliver quality insurance advice in a competitive yet sustainable way. The combination of extremely heavy regulation for those offering advice and the plethora of direct players who are not required to comply on their ‘no advice’ products isn’t helping and needs addressed.
I am surprised that so little action has been taken against the Direct Players.
In my 50plus years experience in the Insurance Industry, if I have learned nothing else – It is the need for a client to be trusting of an adviser whom he trusts and who sees his needs and explains both the Pros and Cons of any recommendations made and clearly explains the consequences of inaction and self-insurance.
Does the public understand the consequences of not providing Medical Evidence at application time, I doubt it – many may find out the hard way at claim time.
There is so much more fraught with danger when effecting PHONE Insurance.
Annual Exams? What other job/profession has an annual exam. I have two degrees and maintain by PD. That should be enough. I am the only concerned about this?
Ben, I agree with you a annual exam to run a risk business? what the????. If they bring this stupid rule in they can scrap CPD points altogether. I will be spending 3 months trying to ace the exam. If you fail what happens forced to sell your business?? Good one for who?
Being in the Insurance Industry for as long as John I totally agree with his comments. When will the Government see that without advice in the selling process we all get categorised with the same label when Insurance companies do not pay. This does not assist in anyway to help the under insurance issue in this wonderful industry
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