Consider the Bigger Picture – Advisers on Risk Commissions

Any future campaign to increase LIF commission caps should be accompanied in equal measure by a campaign to reduce the cost of life insurance advice.
  • Agree (85%)
  • Disagree (9%)
  • Not sure (5%)

Most advisers support the contention that any campaign to increase risk commissions should form part of a broader agenda that also advocates for the delivery of more affordable life insurance advice to many more Australians.

As we go to press this week, 84% of our voting audience agrees with the statement that equal measure should be applied to addressing the cost of life insurance advice when advocating for an increase in the LIF commission caps. Only 10% disagree, and 6% are undecided.

While the subsequent debate has revolved mostly around the legitimacy of risk commissions per se, we think there’s also merit in having a conversation around the notion outlined by the life company CEOs at last week’s 2021 AFA Evolve Hybrid Conference that any future approach to policy makers around increasing risk commission caps needs to be expressed through the lens of how a thriving and sustainable risk advice sector will better serve the community, rather than through the lens of how increasing commission caps will enable risk advice businesses to remain financially viable (see: …Increasing Risk Commissions).

The underlying premise in this debate is that it’s more likely to achieve positive change – for all the right reasons – if the financial advice and life insurance sectors deliver a united message that commission caps, coupled with the sometimes ridiculous burden of compliance that must currently be observed by advisers, are conspiring to deny the Australian consumer of the very benefits that well-intended legislation was designed to deliver.

Our poll remain open for another week and, as always, we welcome your measured contributions.