Weight added to need for a royal commission, says senator
Nationals Senator John Williams says that revelations of poor insurance claims outcomes for clients by CommInsure may lead to a "push" for a royal commission into the financial services sector.
Speaking to ifa following reports by Four Corners and Fairfax which exposed the unfair processing of life insurance claims by CommInsure, Mr Williams said he thinks these events are "going to add" to the case for the need for a royal commission.
Mr Williams explained that the Senate Economics References Committee is currently looking further into the insurance sector and CommInsure as part of the inquiry into the scrutiny of financial advice.
"I don’t know what the committee will recommend... [but] if it is as serious as what Four Corners has highlighted the committee may well choose to push for a royal commission," Mr Williams said.
"If they did [recommend a royal commission] they would have weight from the last recommendation made... for a royal commission into Commonwealth Financial Planning."
"We are there to represent the people and if the people are getting done over then we have to do something about it," he said.
Mr Williams added that he recently called for an extension for the senate committee's inquiry so it could investigate the insurance sector more closely.
"Last week I altered the terms of reference from the Economics References Committee for the [scrutiny of financial advice inquiry] to now include the life insurance industry, how it operates, how it handles claims, [and] whether a code of conduct is needed," he said.
"I think we are going to learn a hell of a lot," he said.
Meanwhile, the events involving CommInsure has led Greens Senator Peter Whish-Wilson to reiterate calls for the need of royal commission into the financial services industry, with the senator stating that the banks need to be put under the "highest level of scrutiny".
"The coercive powers of a royal commission are essential to see how far and how high this problem goes," he said.
"The major parties have ducked this issue so far. My question to them is, how many scandals will it take? How many people need to be dudded before they are willing to take this issue seriously?"
“In recent years, misconduct has been uncovered in three of the four major banks and a number of other smaller banks. They should be handing out a scandal of the month award," he said.
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