Welcome
A year of change ahead W
ith summer continuing to put on a dazzling show, welcome to the first CoverNote of 2021.
It seems almost surreal that we are approaching the anniversary of our first Covid lockdown. There have been many new terms and lessons for all of us over the past 12 months and, despite a number of community outbreaks, we have enjoyed much more normality than most countries. After having seen it deployed around the world, the rollout of our vaccination programme is finally underway, which brings with it much hope and expectation for a return to our pre-pandemic lives. Those involved in providing financial advice will be consumed with ensuring they are making the necessary changes by March 15 2021, when the new Financial Services Legislation Amendment Act (FSLAA) Conduct Regime comes into play. Few, if any, escape its reach, with aspects applying to both retail and wholesale clients. From the outset, Financial Advice Providers and Financial Advisers need to be very clear about their new obligations and new or altered processes. Evidencing that obligations are being met is a key element to have in place. It is entirely likely that things will need to evolve which makes oversight and review crucial so that improvements or issues are captured with any necessary changes made. Further legislative reform continues to be a big focus across our industry. The Reserve Bank has instigated an initial consultation on the Insurance Prudential Supervision Act. The elements they are reviewing include solvency, oversight, branches, reinsurance, and supervision of those carrying out business in New Zealand. IBANZ will be making a submission.
The Financial Markets Conduct of Institutions Bill (FMCIB) is currently awaiting its second reading and we watch the progress of this Bill with interest. There is significant and concerning duplication for those that also fall under the FSLAA Conduct Regime which comes into play this month. This is a cause of great concern as we have stressed to MBIE. While it is critical for intermediaries not subject to FSLAA to be captured under FMCIB there will be a significant imbalance and disadvantage for those subject to both. Lastly, we expect an exposure draft to be released later this year on the Insurance Contract Law Review. This covers several areas across insurance law including insured’s disclosure requirements and remedies if they are not correctly made as well as the potential for coverage comparisons or summaries. It is also expected to draw in other long-standing aspects of our sector, including the intermediary as an agent, Insurance Law Reform Acts, and the duty of Utmost Good Faith. IBANZ will be looking to provide a submission on the draft when it is released. I am currently seeking introductory meetings with the Hon Dr David Clark, Minister of Commerce and Consumer Affairs and the Hon Jan Tinetti, Minister of Internal Affairs. Despite it seeming to be widely accepted that insurance is not a suitable place for the collection of fire service levies (or tax as many refer to it) there sadly seems little appetite or impetus for moving it to the more obvious alternates. We will, however, continue to work towards this, given the greater fairness doing so would bring. All the best for the remainder of this quarter and the year ahead. Stay safe
Melanie Gorham CEO, IBANZ
CoverNote is the official publication of IBANZ and is distributed FREE on a quarterly basis (March, June, September, December) to members throughout New Zealand and associated companies. Additional copies are available at a cost of $7.50 per copy, or 12 month (4 issue) subscriptions at $30.00, inclusive of postage and packaging. The articles or opinions featured within this magazine are not necessarily the opinions of the publishers or IBANZ, and they do not accept responsibility for the content of articles featured within the publication. No part of this publication may be reproduced without the written permission of the publisher. The publishers do not accept responsibility for loss or damage to unsolicited photographs or manuscripts. IBANZ enquiries should be made to: Melanie Gorham, Chief Executive, IBANZ. Email: mel@ibanz.co.nz IBANZ National Office located at: Unit 4D, 2B William Pickering Drive, Rosedale, Auckland 0632 PO Box 302504, North Harbour, Auckland 0751 Telephone 09-306-1732. Website: www.ibanz.co.nz
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