{"id":29078,"date":"2015-03-24T14:59:50","date_gmt":"2015-03-24T03:59:50","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=29078"},"modified":"2015-03-25T07:13:33","modified_gmt":"2015-03-24T20:13:33","slug":"focus-on-professionalism-not-commissions-swanson","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2015\/03\/24\/focus-on-professionalism-not-commissions-swanson\/","title":{"rendered":"Focus on Professionalism, Not Commissions – Swanson"},"content":{"rendered":"

The biggest issue impacting the quality of life insurance advice is the lack of focus on professionalism, not upfront commissions, ClearView’s Managing Director, Simon Swanson<\/strong> has argued.<\/p>\n

<\/p>\n

\"ClearView<\/a>
ClearView Managing Director, Simon Swanson<\/figcaption><\/figure>\n

Presenting as part of a panel discussion at the Australian Securities and Investments Commission (ASIC) Annual Forum, held in Sydney this week, Mr Swanson said he did not believe upfront commissions were the key culprit in poor quality advice, and that the proposed level commissions or fee-for-service models were not practical options for addressing the regulator\u2019s concerns.<\/p>\n

Instead, Mr Swanson said the industry first needed to fix culture and professionalism. He recommended that membership of a professional association should be a pre-requisite of providing advice.<\/p>\n

\u201cThis would drive a professional mind-set, enable codes of ethics to be implemented, drive professional advice processes, and ultimately drive a professional \u2018culture\u2019 where the client\u2019s best interest is truly at the centre of the advice process,\u201d he said.<\/p>\n

Mr Swanson also reiterated the position expressed by ClearView in its submission to the John Trowbridge-led Life Insurance Advice Working Group (LIAWG) that the industry should avoid high-risk changes to adviser remuneration, and focus on upskilling advisers, professionalism and banning poor licensee behaviour.<\/p>\n

He said the only changes that should be made are those focused on fixing the main concerns outlined by ASIC in its review of life insurance advice, namely:<\/p>\n

    \n
  • Overselling<\/li>\n
  • Unjustified policy replacement<\/li>\n
  • Possible under-servicing<\/li>\n<\/ul>\n

    Mr Swanson proposed the following measures to address these issues:<\/p>\n

      \n
    • Capping or limiting adviser payments on large premiums<\/li>\n
    • Reducing payments on policy replacement, but only to remove the windfall gain element<\/li>\n
    • Implementing a reasonable responsibility period, potentially of three years<\/li>\n
    • Allowing additional servicing payments approximately every three years which are linked to actual client reviews occurring.<\/li>\n<\/ul>\n

      \u201cThis approach would limit payments that may distort best advice, while soundly funding adviser businesses and appropriately aligning payments with activity, and indeed encouraging improved servicing via linked additional servicing payments,\u201d he said.<\/p>\n

      John Trowbridge<\/strong> is expected to hand down his independent report on life insurance advice later this week, coinciding with his presentation to the Financial Services Council (FSC) Life Insurance Conference on Thursday.<\/p>\n","protected":false},"excerpt":{"rendered":"

      The biggest issue impacting the quality of life insurance advice is the lack of focus on professionalism, not upfront commissions, ClearView’s Managing Director, Simon Swanson has argued.<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,270],"tags":[],"class_list":["post-29078","post","type-post","status-publish","format-standard","category-compliance-regulation","category-remuneration"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/29078","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=29078"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/29078\/revisions"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=29078"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=29078"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=29078"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}