{"id":36270,"date":"2017-03-07T16:24:45","date_gmt":"2017-03-07T05:24:45","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=36270"},"modified":"2017-03-08T11:02:13","modified_gmt":"2017-03-08T00:02:13","slug":"pjc-member-claims-horse-has-bolted-on-lif","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2017\/03\/07\/pjc-member-claims-horse-has-bolted-on-lif\/","title":{"rendered":"PJC Review Will Not Tackle LIF Reforms"},"content":{"rendered":"

The Parliamentary Joint Committee examining the life insurance sector has stated that the passage and content of the Life Insurance Framework (LIF) are matters for the past and it was focused on the future of the life insurance sector.<\/p>\n

\"Nationals<\/a>
Nationals Senator for NSW, John Williams<\/figcaption><\/figure>\n

Following three days of public hearings from advisers, associations, consumer groups, legal firms and insurers the PJC Inquiry has focused primarily on issues related to underwriting in the group and direct space, mental health claims and the medical assessment and claims processes of life insurers.<\/p>\n

Where the LIF process and legislation has been raised, including in a number of discussions around adviser remuneration and clawback, the PJC has not sought any opinion on whether the legislation should have been introduced or the validity of ASIC Report 413 and the Trowbridge Report which preceded it.<\/p>\n

An examination of the hearings conducted by RiskInfo found that in the nearly 20 hours of hearings conducted across three days, LIF occupied less than two hours of its time and what was raised was presented by individual advisers and advisory bodies and associations, such as the AIOFP, LICG, AFA and FPA.<\/p>\n

However, despite these efforts PJC members did not engage in the topic or reminded witnesses that the Committee would not be reviewing LIF itself.<\/p>\n

This was evidenced in statements from NSW Nationals Senator John Williams<\/strong> following an exchange with Spectrum Wealth Advisers, Chief Executive Mark Schroeder<\/strong> who was representing the LICG on the second day of hearings on 24 February.<\/p>\n

“…it is a case of ‘shut the gate, the horse has bolted’ on the LIF issue…”<\/h6>\n

Schroeder informed the PJC that much of the concern around conflicted remuneration and churn that led to the development of LIF resulted from vertically integrated models pushing advisers to sell in-house products from limited approved product lists.<\/p>\n

\u201cMy concern is that most of the headline issues that created the LIF addressed issues that are systematic in the conflicted remuneration side\u2026A lot of the people who are doing the right thing by the client are being affected by LIF to the point of being not viable. The issue is that banks and insurance companies who are conflicted are causing most of the problems, but their competition, which are the people who actually talk to clients every day, are being made unviable because of the changes,\u201d Schroeder said.<\/p>\n

To this Williams responded, saying, \u201cI am sure you make a very valid point, but it is a case of ‘shut the gate, the horse has bolted’ on the LIF issue. The reason being that some on the other side of politics have done away with commissions totally. Who knows if that is something to be talked about.\u201d<\/p>\n

Williams, who was the only member of the 10-member committee to address LIF, repeated his view that the framework was not on the PJC\u2019s agenda after Schroeder questioned why it was introduced if it made no long-term change to adviser remuneration nor created greater consumer benefits.<\/p>\n

\u201cWe had the consultation [on] LIF that went through months ago. Now we are looking at the insurance industry going ahead. Perhaps we should concentrate on that?,\u201d Williams stated in response.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Parliamentary Joint Committee examining the life insurance sector has stated that the passage and content of the Life Insurance Framework (LIF) are matters for the past and it was focused on the future of the life insurance sector.<\/p>\n","protected":false},"author":3,"featured_media":36324,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,270],"tags":[4247],"class_list":["post-36270","post","type-post","status-publish","format-standard","has-post-thumbnail","category-compliance-regulation","category-remuneration","tag-feature"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/36270","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=36270"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/36270\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/36324"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=36270"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=36270"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=36270"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}