Following the release of the Life Insurance Framework by Assistant Treasurer Josh Frydenberg, the FSC says it has been working on an industry code of conduct.
In a speech delivered at the Financial Services conference on the Gold Coast, chairman Greg Cooper said the life insurance industry has been making “significant progess” to achieve “long-awaited reform” for the sector.
Mr Cooper added that as part of reforming the industry the FSC was developing a code of conduct for the insurance sector.
“[This] will become an FSC standard for our members,” Mr Cooper said.
During his speech, Mr Cooper also said the development of a new remuneration model, improved statements of advice and approved product lists aim to build a more sustainable risk advice industry and “develop better outcomes for consumers”.
The framework announced on 25 June 2015 outlined 14 points for reform.
The points focused on the reduction of adviser commission rates to 60 per cent upfront and 20 per cent trail commission by 1 July 2018, and the introduction of a three-year clawback period.
Also noted with the 14-point reform announcement was the reviewing of approved product lists, and the creation of a code of conduct for life insurers.
Specific details around the reforms are yet to be finalised, but the AFA and advice community are pushing to ensure that areas such the clawback arrangements are not improperly used to affect advisers’ businesses.