{"id":31337,"date":"2015-10-20T09:48:42","date_gmt":"2015-10-19T23:48:42","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=31337"},"modified":"2015-10-20T10:42:56","modified_gmt":"2015-10-20T00:42:56","slug":"level-commissions-loom-if-lif-fails-to-create-change","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2015\/10\/20\/level-commissions-loom-if-lif-fails-to-create-change\/","title":{"rendered":"Level Commissions Loom If LIF Fails To Create Change"},"content":{"rendered":"<p>The Federal Government will give the life insurance sector three years to get its house in order or will move to either a level commission model or extend the conflicted remuneration features of the Future of Financial Advice (FOFA) legislation to cover life insurance as well.<!--more--><\/p>\n<figure id=\"attachment_30992\" aria-describedby=\"caption-attachment-30992\" style=\"width: 150px\" class=\"wp-caption alignright\"><a href=\"https:\/\/riskinfo.com.au\/news\/files\/2015\/09\/Kelly-ODwyer1.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-30992\" alt=\"Newly-appointed Assistant Treasurer and Small Business Minister, Kelly O'Dwyer, will sit down next week with the AFA...\" src=\"https:\/\/riskinfo.com.au\/news\/files\/2015\/09\/Kelly-ODwyer1.jpg\" width=\"150\" height=\"180\" \/><\/a><figcaption id=\"caption-attachment-30992\" class=\"wp-caption-text\">Assistant Treasurer &amp; Small Business Minister, Kelly O&#8217;Dwyer<\/figcaption><\/figure>\n<p>Responding to the Financial System Inquiry (FSI) Final Report today the Federal Government stated it would adopt a different model than the level commissions suggested by the FSI and would support the implementation of the Life Insurance Framework (LIF).<\/p>\n<p>The response, which was co-signed by Federal Treasurer <strong>Scott Morrison<\/strong> and Assistant Treasurer <strong>Kelly O\u2019Dwyer,\u00a0<\/strong>stated the Government had already developed \u201cmeasures to address the misalignment of incentives in life insurance\u201d.<\/p>\n<p>The response agreed \u201cmore can be done to better align the interests of financial firms and consumers\u201d but\u00a0the Government\u2019s response would differ from the FSI and \u201csupport the retail life insurance industry\u2019s proposed reforms\u201d announced in June by then Assistant Treasurer <strong>Josh Frydenberg<\/strong>.<\/p>\n<p>The Government also gave an indication of how LIF would be implemented stating it \u201cwill consider the extent to which legislation and\/or action by ASIC may be necessary to implement the industry agreement\u201d but did not comment on the start date, which is 10 weeks away.<\/p>\n<p>The response also indicates that LIF will have the proposed three-year transition period to take affect but will be reviewed in 2018 and any further reforms may fall back on the FSI recommendation or current legislation within the FOFA framework.<\/p>\n<p>\u201cA Government review in 2018 will consider whether the new industry arrangements for life insurance advice have better aligned the interests of firms and consumers,\u201d the response paper stated.<\/p>\n<p>\u201cIf the review suggests further reform, consideration would be given to the Inquiry\u2019s recommendation for a level commission structure or further extending the existing Future of Financial Advice provisions on conflicted remuneration to life insurance advice.\u201d<\/p>\n<p><a href=\"https:\/\/riskinfo.com.au\/news\/files\/2015\/10\/151020-Government_response_to_FSI_2015.ashx_.pdf\" target=\"_blank\">Click here<\/a> to read the Government&#8217;s complete response to the Financial System Inquiry.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Federal Government will give the life insurance sector three years to get its house in order or will move to either a level commission model or extend the conflicted remuneration features of the Future of Financial Advice (FOFA) legislation to cover life insurance as well.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,270],"tags":[],"class_list":["post-31337","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\/31337","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\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=31337"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/31337\/revisions"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=31337"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=31337"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=31337"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}