Phil Kewin<\/strong> said the 2021 review was \u201c\u2026critical to financial advisers, as the government intends to assess the success of the LIF reforms based upon the level of improvement in life insurance advice revealed in this 2021 review\u201d.<\/p>\n“…the government intends to assess the success of the LIF reforms based upon the level of improvement in life insurance advice revealed in this 2021 review”<\/h6>\n
Kewin said the AFA wanted to provide feedback on the design of the 2021 review and \u201c\u2026in the context of the concerns many members had about the original Report 413 review and the recent apparently conflicting statements from ASIC, the AFA is calling for transparency and certainty in the methodology for the 2021 review\u201d.<\/p>\n
To this end, Kewin said the AFA was seeking for the new survey to include a random sample of life insurance advice alongside any targeted sample \u201c\u2026so that we can be more confident in terms of the real message about the quality of life insurance advice\u201d.<\/p>\n
The submission stated that an industry definition of \u2018lapse\u2019 and \u2018churn\u2019 should be agreed upon before the 2021 review, adding that churn should only apply to inappropriate product replacement without a net benefit to a client and not to lapses that may be caused by factors unrelated to the quality of advice.<\/p>\n
Greater depth also needs to be provided in assessing the quality of advice, according to the submission, which stated that factors such as the experience of an adviser, whether they were a risk specialist or generalist, the size of their approved list and their business model should all be considered when assessing the quality of advice.<\/p>\n
The submission also recommended the 2021 review examines the actions of life insurers, and allow advisers to provide feedback on those actions that contribute to a \u2018sub-optimal\u2019 quality of financial advice or outcome for consumers.<\/p>\n
The AFA also stated that moves could be taken, prior to the review, to ensure a positive result in 2021 and called for \u201clife insurers \u2026to publicly disclose the number of advisers who they refuse to do business with or have placed on level commission only terms and reporting the details to ASIC and licensees.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Any future reviews of life insurance advice should be undertaken using an agreed industry definition for lapse and churn and should include a random sample of advisers, according to the AFA.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[282,8,4,270],"tags":[],"class_list":{"0":"post-38394","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-associations","7":"category-compliance-regulation","8":"category-products","9":"category-remuneration"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/38394","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=38394"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/38394\/revisions"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=38394"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=38394"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=38394"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}