AFA a ‘mixed bag’ on Life Insurance Framework

AFA a ‘mixed bag’ on Life Insurance Framework

A majority of AFA members has moved towards adapting their businesses to the Life Insurance Framework, but there are some that remain unwilling to change, says AFA chief executive Brad Fox.

Speaking to media during the AFA's 2015 National Adviser Conference, Mr Fox said his members are currently a "mixed bag" of advisers who are happy to change and adapt to the Life Insurance Framework, but there are also some that "don't want to change at all".

"This morning we asked members how are they feeling about their future – mad, sad, glad or scared – and the overwhelming show of hands showed they were glad," Mr Fox said.

Regarding those advisers who don't want to change, Mr Fox said that is completely fine, adding that the AFA will be ready to help them transition their business when they are ready.

"Our job is to help them, when they are ready, to recognise they need to move forward," he said.

Mr Fox added that the association has been doing all it can to listen to its members, but also to provide assistance for those looking to adapt with the reforms.

"If an adviser has been in a world, for a predominantly long period of time, of using upfront commissions and now has to change, they need help," he said.

"While we are still working on the framework – which [is a] regulatory battle – on the flipside there is the part that we have to keep building the bridges to help people who want to change their business and move into a different environment."

Mr Fox also explained that the six-month delay to the start date of the LIF will give enough time for advisers, licensees and companies to make the appropriate adjustments they need to move forward with the framework.

"There is absolutely no way that a decision made in November or December will be implemented by 1 January [2016]. Most participants that are licensed are licensees and insurers have said to us it takes close to six months to change systems [and] compliance of this scale," he said.

"I think the majority of advisers will be able to adapt their game plan for their business within six months, but it will be difficult for some if they haven't started thinking already and are taking action around it," Mr Fox said

AFA a ‘mixed bag’ on Life Insurance Framework
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