The regulator on Friday released a draft information sheet around insurance claims handling in response to the introduction of the Financial Sector Reform (Hayne Royal Commission Response) Bill 2020 into parliament earlier this month.
The regulator advised that as a result of the new laws, industry participants involved in insurance claims handling – including advisers as well as insurers, claims managers and brokers – would need to get an AFS licence, obtain a variation on their existing licence or obtain authorisation from another AFS licensee.
Advisers seeking a license authorisation for claims handling would need to complete a claims handling and settling service statement as part of their application, ASIC said.
ASIC advised a transition period would be in place whereby applications would need to be lodged by 30 June 2021 for the adviser to continue providing claims handling services to a client.
After 1 January 2022, advisers would no longer be able to provide the services if they did not have an approved application.
“Applicants can start preparing materials for their application now to allow for timely lodgement as soon as ASIC is able to start taking applications,” the regulator said.
“In the lead up to the commencement of the reforms, ASIC will continue to engage with industry about their implementation of the new requirements and whether ASIC can provide additional assistance to help industry transition to the new requirements.”
This only makes my services more expensive, unfortunatley i can not see a large number of clients i used to help. However, no matter the increase in policy, my fees climb higher and i see less people. Very unfortunate.,
This article is misleading. ASIC has confirmed the proposed law does not apply to the vast majority of Advisers.
WTF!!! There is nothing else to say.
Just when you think ASIC can’t get any worse.
He and his ASIC comrades think that all we do is flog dodgy super funds at an inflated fee.
So if making a claim on a policy is now a financial product then, when the injured party claimed on their income protection it would entail a Statement of Advice…surely there would be some advisers that would turn around and say it’s line ball if you’re going to be successful in your claim, and given I have to spend hours doing an SoA it might be too hard.
So risk advisers provide this service for free and ASIC want to make that harder or take it away. The comedy that is ASIC and this industry just gets better every day!
Are you FREAKING KIDDING ME ASIC??? A key commonality between Advisers in this industry is a quality which perhaps you and your “analysts” don’t quite understand – we wish to help people. Advising clients on the most appropriate policy/ies, structures and sums-insured is only part the way to ensuring they have what they need if something unfortunate was to happen. The other key piece of the puzzle is holding their hand throughout the claims process and doing as much as we can to ensure a favourable outcome in their time of need, and then helping them manage cashflows, budgets, debts and ongoing lifestyle issues once they’re in receipt of the payout. By essentially removing claims assistance you’re screwing clients even more than you already have throughout FOFA and every rule you’ve implemented since. WAKE UP.
Seriously!! Take away the very thing us Risk Advisers do best. So I guess its another annual fee we have to pay for this new license.
Licensees….STEP UP and make your opinions and presence known on this. Hiding and being unseen on this ridiculous recommended restriction, is not acceptable in any way.
The ENTIRE industry needs to fight this. There are no benefits to any insurance policy holder wanting their claims managed properly.
Fantastic! Now I have to get another bit of paper to help clients claim……whilst continuing to not charge them to do the right thing at a difficult time. What a joke!
Damn – one of the Advisors main values in insurance is there assistance with the claims process – in many instances it has made the clients life and claims experience positive. I sometimes wonder regarding the”brains trust” at Asic and our Advisers support bodies aka FPA and AFA being complete “door mats” and yes men
As a risk adviser this might just be a good thing and prevent the lawyers and the like pretending to be experts and charging like wounded bulls.
Will they really want to get and AFS license or seek authorisation from an AFSL?
We put the policy in place, know the client ,understand the policy terms and can offer our services for a fee if we choose.
Dream on. Lawyers and Superannuation Trustees are totally exempt from these regulations.
Well done – push them into the arms of lawyers- they do it for free???
ASIC: let’s solve scaled advice.
Ahahahahahahahaha!!!!!!
Holy smokes! Clients and their trusted advisers again being legislated out of true and holistic advice relationships – and forced into instos to pay $$$$ This sh*t has to stop. Who is there to stop this!!??
Is it April Fools Day????? Every bloody day lately!!!!!!!!!!!!!!!!!
More like Groundhog Day….
ASIC appreciation of Advisers Day, again and again and again – FXXK !!!!!!!!!!!!!!!!!!!!!!!!
Cool, more regulation.
So if you’ve advertised to clients (when implementing cover) that you could help with any claim, or put this in your service agreement, that you would be in breach if you do not go and get the extra bit of paper and client/s subsequently claim? Part of the purpose of ongoing insurance commission is to support claims assistance for no added cost, in the event of a claim.
How are lawyers exempt???? massive % fees of the policy proceeds!!
Don’t believe they are, where does it say lawyers are exempt?
ASIC again trying to put additional pressure on advisers. What is their actual end game? They have a nerve as they are so corrupt themselves – Shipton and his right hand man. How can they even consider this. I’m sure the lawyers will be happy about this so they can charge their clients huge amounts to settle their claims that would be paid out anyway. When is ASIC planning to stop this nonsense, only once the industry is completely destroyed?
This is absolutely disgusting!
These lawyers are just taking the piss now, they are sitting back, laughing at us and giving the middle finger.
ASIC are basically trying to legislate it so that our clients are forced to go to lawyers who in most cases aren’t as good at handling this as planners, whilst charging exorbitant fees.
Has anyone seen what lawyers charge for simple claims?
ASIC need to be removed from any involvement in our industry.
More BS to deflect from the corruption within our dear regulator!
ASIC has no credibility left. Clean up your own backyard. As I keep stating Ethic’s exams for all the who work there. You fail you out see how that fits. Every flipping day something else to smash the Adviser are they that stupid that they cannot see the damage being done to Advisers and Clients. Wake up ASIC/FASEA start using some common sense!!!!
AFA/FPA/ and the insurers you need to wake up before we turn the lights off on this industry and then let the chaos begin.
Did our Industry Bodies flag this one?
FPA MIA
Again!!
Yep crickets from the FPA.
What about the ambulance chasers? Lawyers that take 30% of a claim and do nothing for it. How is it that advisers are the ones restricted? We’ve helped clients through the claims processes at no extra charge since day 1. This change will mean we now charge for it.
I would have thought an investigation into the capability of the legal firms providing claims advice on superannuation and insurance would be far more appropriate. Could have a bit of fun with whose best interest that is in…..
What a F#$%ing joke!
We really need someone in government to step up here to do something about ASIC, they really have lost their way, and I am really not sure whether they are corrupt or incompetent, whatever the reason, ASIC has lost the plot.
An extra reason to NOT buy insurance.
I hope that this includes our legal friends
Nope – as usual from what I can see they have a specific carve out. The very area that causes the most client loss and they get carved out. Fair enough they are sometimes required but only once the insurer has actually denied a claim. How many millions of dollars has been shifted from the client to the lawyers unneccessarily? That would be a study I would like to see done by the insurers!
so now advisers have to get an AFS to claim on a AFS regulated policy which they previously wrote using an AFS? These politicians have really lost their marbles and all common sense
ASIC is corrupt!
So we ADVISERS help our clients with claims sometimes for FREE but now that is not good enough or for the small fee paid via the insurer.
This is only for their lawyer mates to find a new FEE source! Maruice Blackburn advertising on TV to help people with TPD claims….. I have seen there fees for this and it is around $32,000 if sucsessful on the first go and if they have to appeal then they take/steal $45,000 of the claim proceeds. I have the documents to prove this from a client who saw them. TPD claim would have been $423,000.
What bureaucratic nonsense!
Well that takes the cake…. yes let’s make sure that advisers can’t help clients with claims so they get ripped off, or lets send them to greedy no win no pay solicitors who can take a straight forward claim and end up losing 40% of the payout in the “fee”….this is getting more ridiculous by the day!
Or even better they don’t make a claim. You would almost think the large institutions wanted this result
SERIOUSLY? WTF are ASIC playing at here??
WHY would ASIC put yet another hurdle in front of a client working through a claim with the very people who can help them best? There’s something very NOT RIGHT here if this goes through.
I’ll be contacting my local Federal MP about this straight away.
No doubt at a cost….best I go water my money tree in the back garden.
You wonder if this will only apply to financial planners helping clients with a claim, many who do so at no additional cost to their clients, and whether it will apply to those legal firms who “assist” clients lodge claims against those ‘nasty’ insurers and take 30% – 40% of the claim proceeds for their troubles….
Somehow I dont see ASIC letting ME charge a client those sorts of % based fees, given I’M just a lowly financial planner….
I notice there was no mention about Solicitors or lawyers who are not qualified to give financial product advice. Does that mean if I apply for this licence, I too can advertise in the market place that they will “”get more with me””, even if I charge 30% commission. Wooops. Did I say commission? I mean winners fee.
unbelievable.
What a BRILLIAN IDEA (NOT!!!!) ASIC. Let’a have another FARSE academic exam so that someone can handle claims.
Will this rule extend to lawyers and insurance claims departments or only Financial Advisers (whom Minister Jane Hume says she would like to support as much as possible)?
More authorisations. Seriously??? Isn’t it already implied via all of our other authorisations and FASEA CoE that we are doing this in the clients best interests? More time, more money and more complexity. When will the Hayne train come to a stop??!
Assuming ASIC will be applying these requirements (AFS licence / authorisation / etc) to participants of the Legal industry whom provide insurance claims assistance?
What can we expect. Hayne didn’t want to see his ambulance chasing mates involvement in this sector curtailed.
This new requirement will only result in more business going to lawyers and less for clients.
When is this madness going to end
What a load of bullshit. Does this dodering old fool even understand what advisers do and how they help clients. If adviser didn’t help clients many claims wouldn’t be paid. In the last 6 years i have had insurers overturn 5 claims from a decline to an approval because i pushed the case with them. IF i wasn’t helping the client they get zero.This guy should be sent to a retirement home and refund his fee. He has done nothing but kill this industry, especially for sole operator financial planning businesses.
and what will the cost of this licence be?…plus another FARSEA exam??
A mess. Now Advisers needing to be licensed to assist clients in the claims process with the insurance they set up for them. The constraints being placed on Advisers is becoming uncommercial. Will lawyers now need an AFSL to assist clients through the claims process?
Not likely….not under the ASIC model….