Safe Harbour Biggest Obstacle – Poll

Compliance with the seven Safe Harbour steps is the single biggest driver of cost and the biggest obstacle to accessing affordable financial advice.
  • Agree (61%)
  • Disagree (28%)
  • Not sure (11%)

Most advisers seem to agree that the existing safe harbour boxes needing to be ticked are the biggest drivers of cost and the biggest obstacle to affordable advice.

As we go to print, just under six in ten who have voted in our poll (58%) have identified the safe harbour steps as the main ‘culprit’ to cost and affordability of advice, while 28% disagree and 14% are unsure.

These results appear to accord with a statement made by the FSC in its recently-released white paper on financial advice, in which it noted feedback from across the advice community is that the safe harbour steps are the number one driver of cost and the biggest obstacle to accessing affordable and compliant scalable advice aligned with consumer needs.

While the poll considers the extent to which safe harbour requirements are an impediment to affordable financial advice, the comments we’ve received take the opportunity to reflect on what is viewed as a more significant impediment when it comes to life insurance advice. This greater impediment relates to the perceived failure in the eyes of many advisers of legislators to separate life insurance advice from the minimum education and compliance rules surrounding the delivery of financial planning and investment advice:

Investment advice is wanted and Australians are willing to pay for it, as they know the complexity could financially cripple them if they do not get advice.

This leads us to Insurance advice.

Australians will not pay a fraction of what it costs Advisers to provide [life insurance advice]…

According to this argument, quality life insurance advice could be delivered at a significantly-reduced cost if the advice process was not subject to the same rules governing financial planning/investment advice.

The merits of this argument continue to be debated, but it appears to be a moot point, given life insurance advice is unlikely now to be carved out of existing legislation and treated separately in future.

In the meantime, our poll remains open for another week and we welcome your thoughts…


  1. As complex as the arguments for and against the separation of Insurance and Investment advice are, what is simple to understand, are the consequences of not separating them.

    What we have today is an unmitigated disaster with thousands of Advisers having exited the Industry, the Life Insurers facing continual declines and more red tape, not less.

    At what point will the light bulb turn on and the Government realise that the current system and regulatory maze is not making it more affordable and accessible for all Australians to attain advice and appropriate Insurance coverage.

    Waiting until the Industry is decimated, then changing direction is not good policy.

    What is good policy, is to listen to Advisers for a change and ask them what will be sufficient to give them cause to stay and write Insurance, without being snowed under with red tape and a risk of failure.

    Advice practices will decide if they can write Insurance, based on the viability, cost of complying, risk and profitability.

    The Government and the Regulators understand there is a problem, though they do not understand how to fix it.

    One thing is sure. the current Regulatory regime is an anchor that is holding the entire Industry and all Australians back.

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