The Financial Services Council (FSC) has confirmed that governance of the Life Insurance Code of Practice (Life Code) will transition to the Council of Australian Life Insurers (CALI) effective 29 September.
This week, CALI will assume responsibility for the Life Code and become the primary point of contact for code-related matters for industry stakeholders, regulators, and policymakers.
Namely, the Life Code sets important benchmarks to ensure that people can take out life insurance with confidence and that, if the time comes, their life insurer will be there to support them. It covers all aspects of life insurance, from sales practices and timelines to claims handling and making complaints.
The FSC first unveiled an updated Life Insurance Code of Practice, featuring 50 additional consumer protections, in July.
The additional protections include increased support for customers experiencing vulnerability or financial hardship, guidelines for the development of family violence policies, and the removal of blanket mental health conditions.
In conjunction with July’s announcement, CALI, whose 19 members adhere to the code, said it was collaborating with the FSC to transition governance of the Life Code to CALI by 30 September.
Commenting on the transition, FSC chief executive officer Blake Briggs said: “I am proud of the work the FSC has undertaken to deliver the Life Insurance Code of Practice, and the positive impact it has had on life insurance consumers.
“The current version of the Life Code entered into force on 1 July 2023, and expands on the important work completed by the FSC when the original Code of Practice was released in 2017,” Mr Briggs continued.
“As the landscape of industry representation has evolved in the last few years, it has become evident that transferring the Life Code to CALI is the appropriate step forward, and we are confident that life insurers will be well-served by the new association’s responsibility for the Life Code.”
As part of the updated Life Code, it was revealed that stronger authority would be afforded to the Life Code Compliance Committee (LCCC), administered by the Australian Financial Complaints Authority (AFCA), which is responsible for monitoring the life insurance industry’s application of the code and the conduct of individual insurers.
As such, the FSC confirmed in a statement that the LCCC will continue to ensure that the Life Code’s principles are upheld and enforced.
“The FSC will continue to be a leading voice in related policy debates, including financial advice and the increased political and regulatory scrutiny surrounding group life insurance in superannuation,” Mr Briggs added.
“Our ongoing involvement in insurance-related policy reflects our commitment to safeguarding the interests of consumers and ensuring that the financial services industry remains responsive to consumers’ needs.”
Responding to FSC’s announcement, Justin Delaney, CEO, Zurich Australia and New Zealand, said: “The code represents the life insurance industry’s commitment to protecting customers and continually evolving. As the peak body for life insurers, CALI’s ownership of the code further underlines this commitment.
“At Zurich, we take acting in the best interests of our customers seriously and we support maintaining an industry-wide approach that holds all insurers to a high standard. The code impacts all facets of our customer interactions, from how products are designed and sold, through to the claims experience,” Mr Delaney said.
