- Yes (72%)
- No (25%)
- Not sure (2%)
Our first poll of 2016 explores the complex question of whether risk-focused advisers should be considered differently from their ‘financial planner’ peers when it comes to minimum educational requirements.
This question (to which there is no right or wrong answer) is being driven by arguments raised by risk-focused industry leaders in response to the Government’s draft legislation on professional standards. This proposed legislation is deemed by the Government to be required to raise the educational, training and ethical standards for financial advisers to a level acceptable to the broader community.
…the Federal Government presupposes that financial planners and risk writers are in the same discipline
Synchron’s Don Trapnell has weighed in to the debate this week, arguing that the proposed Education Standards Bill should streamline educational pathways for differing disciplines. Trapnell says the Federal Government presupposes that financial planners and risk writers are in the same discipline “…but they are not,” he says.
This is the crux of the argument, on which advisers, regulators, politicians and consumers will debate. That is, should life insurance be considered a sufficiently different form of financial advice to require it to be streamed as an effectively different ‘discipline’ when it comes to the educational criteria required for that advice conversation. Or should all advisers (authorised representatives), irrespective of the nature of their advice proposition, be held to the same minimum educational qualifications?
Trapnell uses his own industry history as a point in favour of his argument. Citing his qualifications, experience and record, Trapnell asks: “…why should I and risk advisers like me have to re-train?” One answer to this question is that this may be required of Trapnell and other long-standing, dedicated advisers in order to atone for the sins of a few, so that the broader community will regain its trust in financial advisers following the damage inflicted on their reputation by those few.
Is this fair? Or should minimum educational qualifications be determined by the nature of the advice proposition?
As always, we’re in your hands. Cast your vote and make your voice heard on this difficult question.
I usually agree with Don, however we need to raise the education standards of all advisers in the industry. I completed my Financial Planning Diploma in 2 months and it was a joke, anyone can pass it. I know people in the industry who would struggle to pass grade 12 but are allowed to advise people on how to invest millions of dollars. If we want to remove the rogues from the Risk and Wealth sides of FP then being degree qualified is the only way to go. You require a uni degree in the majority of professions, it makes no sense and is actually totally crazy that “professionals” who help people with life changing financial decisions can get a qualification in a matter of weeks.
Hmm, a financial planning diploma is that easy to get, is it? Universities today are a huge business. They love all of the focus on higher education because it delivers truckloads of more business for them. Has the world become a better place because people today generally have a higher standard of education than their parents or grandparents had? Hardly! Being specific, a university qualified risk adviser will generally have no more ethics (more likely less) or be better equipped to deliver advice than those otherwise. Do you seriously believe all legal people set the benchmark for ethics in our communities?
Don is 100% correct, though the associations and regulators want to keep it simple for them to control all advice and advisers, by having it all merged into a ONE SIZE fits all package, which of course will never work properly.
Insurance advice requires much more than what a text book or university lecturer can
provide and unlike Investment advice that is continually plagued with scandal, a lack of Insurance coverage for all Australians is the scandal facing us today.
The education industry are clambering all over this, as it is in their interest to promote higher education (that is how they make their money)
The benefit a young adviser will derive from working in the Life Insurance Industry, will come from hands on experience, being mentored and working in specialist risk practices, where most of their knowledge will be learned.
The starting point should be from a properly structured, intensive 4 to 6 week initial introduction to the Life Industry that goes through the fundamentals of how Life Insurance and the products work, with Life Companies contributing input on the mechanics of how it all fits together. This they do well.
The positives far outweigh any negatives doing it this way and brings young people
into our industry in a cost and time efficient manner.
The issue facing Australia is a massive under insurance epidemic.
Throwing up barriers and forcing young people to get a degree qualification before they can even decide if this career path is what they want, will not improve this.
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