TAL’s acquisition of life insurance comparator Lifebroker may present a conflict of interest, according to some stakeholders in the risk specialist financial advice community.
In a post on the Australian Risk Advisers (ARA) LinkedIn group, Trisanth Chandrahansan of life insurance software provider Omnium voiced concern over TAL’s acquisition of the remaining 90 per cent of shares in Lifebroker, suggesting an inherent conflict of interest.
“As a consumer, I would be going into a life insurance comparison website to get an unbias (sic) comparison,” Mr Chandrahansan wrote.
“I wouldn't be confident I'm getting an unbias comparison from a website that is owned by one of the insurance companies. It’s like going to compare smartphones on a website owned by Apple.”
Speaking to ifa, Hub Financial adviser Graham Hutton went a step further. “I think [TAL’s acquisition of Lifebroker] is bollocks – talk about conflicted remuneration,” he said.
Mr Hutton said he saw a “definite conflict” in the deal and would not be comfortable using the tool when engaged in services for his clients. “You couldn’t trust it,” he said.
However, Don Trapnell, director of risk-focused dealer group Synchron, said that while he initially questioned the deal, he ultimately concluded that as long as a “Chinese Wall” was in place between the two businesses, there is no cause for concern.
Mr Trapnell added that the TAL Group has a good track record when it comes to maintaining separation between the life product and licensee arms of the business.
Similarly, Medibroker director Aaron Zelman, founder of the ARA LinkedIn group, said the acquisition does present a conflict, but not necessarily a concerning one.
“Conflicts of interest are ever present and require effort and effective management,” Mr Zelman said. “It could be a positive thing. Hopefully Lifebroker is a tool for more Australians to get quality advice.”
An adviser has slammed the poor behaviour of insurers in hiking premiums for existing customers while new client rates stay unsustainably low, as the ...
The corporate regulator has used its enhanced banning powers to restrict the former head of a collapsed asset manager from financial services in any ...
The government has rushed new legislation to Parliament in the wake of its ushering in a new broom at ASIC, which will keep the regulator accountable ...