Rolling the ASIC LIF Review into the 2022 Review of the Quality of Financial Advice
AFA News 30 April 2021. On 21 April 2021, at the FSC Life Insurance Summit, Minister Hume announced that the Government had made the decision to roll the 2021 ASIC LIF Review into another key advice review that will be conducted in 2022. Recommendation 2.3 of the Banking Royal Commission required the Government to undertake a review of the Quality of Advice and a range of related matters by December 2022. This review is to be undertaken by Treasury.
We are supportive of this announcement by the Government as it will enable the review of Life Insurance Commissions (that was the core objective of the ASIC LIF Review), to be part of a broader review and to consider a range of other issues such as the accessibility and affordability of life insurance advice. We also hope that this review will look at the important consideration of what consumers want, as there are multiple studies and practical real-life experiences where clients prefer the option of paying for their life insurance advice by the means of a commission, rather than paying a large upfront fee in year one. Ultimately, the AFA strongly supports the ability for clients to choose how they pay for their life insurance advice, and commissions should be one of the options.
Treasury has started work in preparing for the 2022 Review and we will seek to work with them on this important review.
If you have any questions about this announcement, then please email [email protected].
Issued 30.04.2021. AFA Policy & Education Update