{"id":62141,"date":"2022-08-09T13:41:50","date_gmt":"2022-08-09T03:41:50","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=62141"},"modified":"2024-10-30T08:43:40","modified_gmt":"2024-10-29T22:43:40","slug":"keep-commissions-and-allow-scaled-advice-mlc-life-insurance","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2022\/08\/09\/keep-commissions-and-allow-scaled-advice-mlc-life-insurance\/","title":{"rendered":"Keep Commissions and Allow Scaled Advice – MLC Life Insurance"},"content":{"rendered":"

Retaining risk commissions and scaling advice are critical solutions being advocated by MLC Life Insurance as desired outcomes from Treasury’s Quality of Advice Review.<\/p>\n

While not having provided a formal submission, the insurer has held several meetings with independent reviewer Michelle Levy<\/strong> and her Treasury colleagues, during which it has presented its case in support of what it says are the most important factors that will deliver greater access to financial advice for all Australians, regardless of their financial status.<\/p>\n

…we are haemorrhaging advisers<\/p><\/blockquote>\n

\"\"<\/a>
MLC Life Insurance GM Retail Distribution Partnerships, Michael Downey …a real fear that only the wealthiest Australians will be able to afford advice<\/figcaption><\/figure>\n

Foremost among the top priorities, according to a release issued by MLC Life Insurance this week, is for the industry to act on reducing the cost of advice. The insurer’s GM Retail Distribution Partnerships, Michael Downey<\/strong>, notes that after years of inordinate regulation, however well intentioned, “…we are haemorrhaging advisers who provide critical advice to clients in their time of need.”<\/p>\n

Warning this trend is unsustainable, Downey adds that unless the industry takes steps to reduce the cost of advice, “…I have a real fear that only the wealthiest Australians will be able to afford to see an adviser.”<\/p>\n

Referring to benchmark research it commissioned in 2019, the insurer warns that unless advisers can remove 20-25% of the current cost base for each business, advice will not be profitable, which will leave many Australians to make important financial decisions on their own.<\/p>\n

…an average of 10 hours is required by a risk adviser to prepare and implement [simple] life insurance advice<\/p><\/blockquote>\n

According to the benchmark research, an average of 10 hours is required by a risk adviser to prepare and implement life insurance advice for a client in simple cases, and up to 15 hours for more complex cases.<\/p>\n

The most important elements that will drive a reduction in the cost of financial advice, says MLC, include:<\/p>\n

Retaining risk commissions<\/strong><\/p>\n

Advocating the need for consumer choice in how to pay for advice, the insurer argues: To have a sustainable advice sector, commissions must continue to remain an option that supports everyday Australians having access to much- needed financial advice during key life moments. This includes maintaining the Life Insurance Framework.<\/em><\/p>\n

Scaled advice<\/strong><\/p>\n

MLC advocates the need for scaled advice tailored to specific customer need: For life insurance, this could be as simple as a \u201cLife Cover Assessment\u201d that may or may not include a product recommendation. Despite consumers calling out for this style of advice, current regulation and guidance makes this difficult in practice, with often the only options provided being costly full, holistic personal advice or no advice\/support at all.<\/em><\/p>\n

Other key solutions MLC is seeking – with the aim of delivering more access to advice for all Australians include:<\/p>\n

    \n
  • Tax deductibility of advice<\/li>\n
  • Increased use of technology and digital solutions<\/li>\n<\/ul>\n

    Downey concludes: \u201cWe must do what\u2019s right for our customers and their advisers, which means ensuring more advice, not less. The recommendations we have put forward to Michelle Levy and her team are reasonable and we look forward to working closely with them over the coming months to ensure a positive outcome for all Australians.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

    Retaining risk commissions and scaling advice are critical solutions being advocated by MLC Life Insurance as desired outcomes from Treasury’s Quality of Advice Review. While not having provided a formal submission, the insurer has held several meetings with independent reviewer Michelle Levy and her Treasury colleagues, during which it has presented its case in support […]<\/p>\n","protected":false},"author":3,"featured_media":62160,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,270],"tags":[],"class_list":["post-62141","post","type-post","status-publish","format-standard","has-post-thumbnail","category-compliance-regulation","category-remuneration"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/62141","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=62141"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/62141\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/62160"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=62141"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=62141"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=62141"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}