Advisers concerned LIF will hinder best interest duty

Advisers concerned LIF will hinder best interest duty



An overwhelming majority of advisers believe the three-year clawback period will impede their ability to meet their best interest duties, an industry-backed survey has found.

A collective of advisers and dealer groups, called the Life Insurance for Consumer Group, have conducted a survey to uncover the true sentiment of advisers regarding the Life Insurance Framework (LIF).

Of the 5,000 advisers sent the survey, 509 submitted responses that covered a range of issues relating to the LIF.

Of the 509 respondents, 423 (83.1 per cent) believe that a clawback period of three years would impede on their ability to deliver against their legislated best interest duties with respect to their client’s needs.

This was compared with 74 respondents (14.5 per cent) who said it would not, while 12 respondents did not provide a ‘yes’ or ‘no’ response.

An overwhelming number of respondents (473 or 92.9 per cent) also said they did not believe the Life Insurance Framework will benefit consumers.

In fact only 17 (3.3 per cent) respondents believed that the framework would benefit consumers.

The survey also found that 195 advisers believe at least one person per business will have to be let go in order to make the business profitable under the LIF.

This was compared with 22 respondents who believed at least three employees per business will be let go and 25 respondents who believed more than four would be let go.

View the full survey results here.

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