In a statement, the FSC said it would make the changes to the code following a two-year consultation period with industry.
Key reforms to be made to the code as a result of the consultation would include making it ASIC enforceable, broadening its application to include third-party distributors, introducing additional protections around surveillance of claimants, and implementing clear obligations on insurers around communicating with policyholders.
The FSC said it intended to submit the revised code to ASIC to make certain provisions enforceable by the regulator, while others would be enforced by the Life Code Compliance Committee.
The LCCC would also be given additional powers to enforce sanctions on FSC insurer members who significantly breached the code.
“Life insurers recognise the importance of the code and of reviewing the Code as part of a process of continual improvement,” FSC chief executive Sally Loane said.
“There are many lessons learnt since the code was introduced which are incorporated in this response document. The government will soon introduce legislation which would see certain provisions of the code made enforceable, breaches of which would be subject to civil penalties.”
Guess who benefits from the reduction in insurance commissions and increases in the responsibility period?
Insurers (and banks) don’t give a stuff about ASIC or APRA.
The code has been a failure because it is still in the hands of the FSC who are just a paid for lobby group by the insurers to benefit the insurers. The FSC are the mouth peace of the insurers and are only ever going to act in the insurers interests regardless of the negative consequences to customers or advisers (the LIF being a case in point).
The code and its enforcement needs to be taken out of the hands of the FSC and put into the regulators hands.
Who died and made FSC the boss of Financial Advisers?
We are not (yet) dead… just hanging on by the threads of our book of clients built up with a combination of blood, sweat and anxiety.
“ASIC enforceable, broadening its application to include third party distributors”,…..is this another code that advisers have to abide by…i have lost count of how many codes i need to comply with.
FSC needs to be funded by the tax payer, as this makes for better & fairer inquiries. I feel that any industry paymaster has some say in any matter that may involve the paymaster.