The Commonwealth Bank of Australia today announced its support of the new reform model for Australia’s life insurance industry released by The Honourable Josh Frydenberg MP Assistant Treasurer.
The reform model is in response to the Trowbridge Report, released to address issues raised in the Australian Securities and Investments Commission’s Review of Retail Life Insurance Advice report (9 October 2014) and undertaken by former APRA Member John Trowbridge.
Annabel Spring, Group Executive, Wealth Management said, “We have worked with financial advisers, industry groups and the broader industry to help develop these reforms which we believe will transform life insurance and advice to deliver long-term benefits for customers.
“The introduction of the Code of Conduct and the increased reporting to ASIC complement the measures CBA has taken to promote and advocate for the recognition of financial advice as a profession,” said Ms Spring.
The reform package includes a new remuneration model with a phased transition to a maximum total upfront commission of 60 per cent of the premium in the first year of the policy from 1 July 2018, development of a Life Insurance Code of Conduct and an ASIC review of Statements of Advice with a view to making disclosure simpler and more effective.
“The phased commission changes provide clarity for advisers as they adjust their business models to enable them to continue to meet the financial advice needs of all Australians, and we are committed to ensuring advisers are supported as the changes are implemented,” said Ms Spring.
The Commonwealth Bank will continue to work with the Government and industry groups to implement these reforms.