PROFESSIONALISM / Industry Bulletin
QUALITY OF ADVICE REVIEW LEGISLATION UNVEILED
L
ast month Assistant Treasurer and Minister for Financial Services, the Hon Stephen Jones MP unveiled the first tranche of legislation, to implement the government’s response to the recommendations of the Quality of Advice Review. As announced by the Federal Government earlier this year in its ‘Delivering better financial outcomes roadmap’, the reforms will be introduced as part of a three-stage process, with each stage aligned to a different stream: • Stream one – removing red tape that increases the cost of advice; • Stream two – expanding access to retirement income advice; and • Stream three – exploring new channels for advice. The legislation includes reforms aimed at removing regulatory red tape that increases the cost of advice including:
• Introducing client consent requirements for life insurance, general insurance and consumer credit insurance commissions (QoA recommendations 13.7-13.9); and • Amending FSG requirements to allow providers greater flexibility in the way they provide disclosure documents (QoA recommendation 10). Other reforms that were originally slated for release in Stream 1 including replacing Statements of Advice with a fit-for-purpose record of advice (QoA recommendation 9) and the removal of Safe Harbour steps (QoA recommendation 5) have been postponed until Stream 2.
FLEXIBILITY FOR FINANCIAL SERVICES GUIDE (FSG) REQUIREMENTS
The draft legislation proposes amending the Corporations Act to allow providers of personal
12 / INSURANCE ADVISER DECEMBER 2023 / JANUARY 2024
advice to either continue to give their clients a FSG or instead make the FSG information publicly available on their website. A provider can choose whether to continue providing a FSG in accordance with the current law or alternatively provide the FSG on their website. To rely on the alternative option, where a provider does not give the client a FSG and instead includes the information on its website, certain requirements must be met: • The financial service provided to the client is personal advice; and • At the time the advice is provided, the client has not requested a copy of the FSG and the information that would have been in the FSG is available on the provider’s website; and • At the time the advice is provided, each web page displaying the information is readily accessible, up to date and records the date the page was prepared or last updated.
