The FAAA is recommending the incoming client consent obligations be adopted by advisers well before the 9 July deadline to avoid penalty payments for non-compliance.
The organisation is reminding advisers that it is the date of issue or sale of a policy that determines if the new consent requirements apply, not the date the adviser provides their advice.
“Given the time that it may take for the insurance policy application to be processed and underwriting to be undertaken, it might mean that there will be a reasonable delay between when the advice is provided and when the policy is issued or sold,” states the FAAA.
The organisation adds that’s it important advisers provide the required disclosure information to their client and obtain a compliant client consent before any commission has been paid for insurance policies issued or sold from 9 July 2025.
“Otherwise, the commission would be classified as conflicted remuneration, be considered non-compliant, and attract penalties,” states the FAAA.
It recommends licensees start this new requirement by:
- Identifying and monitoring your existing cases that are in progress, that may be impacted by policy processing delays, and
- Carefully checking the date of issue or sale for new policies where there has been a delay in processing, to identify cases where the consent obligation has not previously been met and the policy is issued on or after 9 July 2025.
For further information on the Life Insurance Client Consent obligation see ASIC Information Sheet 292.
The FAAA has also provided a video guide for members.