{"id":28364,"date":"2015-01-07T12:51:03","date_gmt":"2015-01-07T01:51:03","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=28364"},"modified":"2015-01-21T06:52:27","modified_gmt":"2015-01-20T19:52:27","slug":"asic-life-insurance-review-leads-to-action-against-guardian-advice","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2015\/01\/07\/asic-life-insurance-review-leads-to-action-against-guardian-advice\/","title":{"rendered":"ASIC Life Insurance Review Leads to Action Against Guardian Advice"},"content":{"rendered":"<p><span style=\"font-size: 14px;line-height: 1.5em\">The Australian Securities and Investments Commission (ASIC) has imposed license conditions on Guardian Advice, due in part to advice deficiencies uncovered through its recent retail life insurance advice review.<\/span><\/p>\n<p><!--more--><\/p>\n<figure id=\"attachment_27666\" aria-describedby=\"caption-attachment-27666\" style=\"width: 150px\" class=\"wp-caption alignright\"><a href=\"https:\/\/riskinfo.com.au\/news\/files\/2014\/10\/Peter-Kell-2.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-27666\" alt=\"ASIC Deputy Commissioner, Peter Kell\" src=\"https:\/\/riskinfo.com.au\/news\/files\/2014\/10\/Peter-Kell-2.jpg\" width=\"150\" height=\"180\" \/><\/a><figcaption id=\"caption-attachment-27666\" class=\"wp-caption-text\">ASIC Deputy Commissioner, Peter Kell<\/figcaption><\/figure>\n<p>The regulator has confirmed that Guardian Advice was one of the firms included in the <a href=\"https:\/\/riskinfo.com.au\/news\/2014\/10\/09\/asic-life-insurance-advice-review-unacceptable-level-of-failure\/\">review<\/a>, as well as being subject to surveillance following the group\u2019s appointment of a number of ex-AAA Financial Intelligence representatives in 2013 (see: <a href=\"https:\/\/riskinfo.com.au\/news\/2013\/10\/14\/aaa-license-cancelled-due-to-inappropriate-insurance-advice\/\">AAA License Cancelled Due to Inappropriate Insurance Advice<\/a>). However, the regulator advised that its surveillance was not confined to advice from ex-AAA representatives or life insurance advice, saying it had conducted a broad surveillance across the business looking at advice from a number of representatives and at a number of features of Guardian Advice\u2019s business.<\/p>\n<p>Through this surveillance, ASIC said it had found instances where there was not a demonstrated reasonable basis for the advice provided by Guardian Advice representatives, and that it had also uncovered examples of advice files that did not contain evidence that the advice given was in the best interests of the client.<\/p>\n<p>In addition, ASIC said it was concerned that Guardian Advice did not have adequate arrangements in place to ensure it was complying with its general obligations as an Australian Financial Services licensee. Specifically, ASIC was concerned that Guardian Advice did not:<\/p>\n<ul>\n<li>Properly assess and monitor its representatives\u2019 competence to provide financial services<\/li>\n<li>Have adequate measures in place to meet its record-keeping obligations<\/li>\n<li>Adequately respond to identified breaches by its representatives<\/li>\n<li>Have in place adequate human and technological resources<\/li>\n<\/ul>\n<p>Under the license conditions imposed by ASIC, Guardian Advice must appoint an ASIC-approved independent consultant to review its compliance with its general licensee obligations and develop a plan to rectify any deficiencies identified by the expert. The expert will report regularly to ASIC over the next two years on Guardian Advice\u2019s implementation of the plan.<\/p>\n<p>ASIC Deputy Chairman, <strong>Peter Kell<\/strong>, said: \u201cThe weaknesses in Guardian Advice\u2019s systems and controls show that there was an ongoing risk that unsuitable advice could be provided by Guardian Advice and its authorised representatives.<\/p>\n<h6>there was an ongoing risk that unsuitable advice could be provided by Guardian Advice and its authorised representatives<\/h6>\n<p>\u201cThis outcome underlines ASIC\u2019s strong commitment to lifting standards in the life insurance sector. When we come across instances that raise issues for the confidence consumers have with advice, we will take action.\u201d<\/p>\n<p>Mr Kell also acknowledged the cooperative and constructive approach of the dealer group in response to the concerns. He said the regulator\u2019s investigation was ongoing, and that ASIC was considering whether further enforcement action, such as banning individual advisers, was required.<\/p>\n<p>When releasing the ASIC report into retail life insurance advice last year, Mr Kell said that where issues had been identified, the regulator would work with the relevant licensee to address its concerns. Guardian Advice is the first licensee to have been identified as participating in the review.<\/p>\n<p>A spokesperson for Guardian Advice said ASIC\u2019s surveillance had commenced on 23 September 2013, and involved consideration of the implementation of policies and procedures, advice, recruitment, adviser audit and training.<\/p>\n<p>\u201cASIC found a number of improvements that could be made and additional licence conditions have been introduced, which will be overseen by ASIC and includes the appointment of an independent expert to complete a review of the Guardian Advice business in these areas,\u201d the spokesperson said.<\/p>\n<p>\u201cGuardian Advice takes ASIC\u2019s findings very seriously and we are working with ASIC to ensure the necessary improvements are implemented by the business.<\/p>\n<h6>Guardian Advice takes ASIC\u2019s findings very seriously<\/h6>\n<p>\u201cThe life insurance and advice industries are undergoing widespread reform and Guardian Advice accepts that it is appropriate that there is greater scrutiny of these industries.<\/p>\n<p>\u201cGuardian Advice is confident it can seize this opportunity to improve our business, including improvements in adviser recruitment, training and adviser audit processes.\u201d<\/p>\n<p>In the same week, Suncorp Life, the parent company of Guardian Advice, announced that Executive General Manager Distribution, <strong>Jordan Hawke<\/strong>, would be leaving the company (<a href=\"https:\/\/riskinfo.com.au\/news\/2015\/01\/06\/jordan-hawke-to-leave-suncorp-life\/\">click here<\/a> for more). Guardian Advice\u2019s spokesperson said they could not speculate on whether the two announcements were linked, but believed they were unrelated and that Mr Hawke\u2019s decision to leave Suncorp Life was a personal one. Mr Hawke was not available for comment.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Australian Securities and Investments Commission (ASIC) has imposed license conditions on Guardian Advice, due in part to advice deficiencies uncovered through its recent retail life insurance advice review.<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,6],"tags":[],"class_list":["post-28364","post","type-post","status-publish","format-standard","category-compliance-regulation","category-dealer-groups"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/28364","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=28364"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/28364\/revisions"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=28364"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=28364"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=28364"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}