Adviser Ratings welcomes Trowbridge report

Chris Zinn from Adviser Ratings, the consumer campaign to bring transparency to financial planning, said today the Trowbridge Report reforms into life insurance were balanced, considered and long-overdue.

Adviser Ratings welcomed the leadership the Financial Services Council and Association of Financial Advisers have shown in commissioning the inquiry and urges speed with any further consultations.

Mr Zinn said “Consumers have known for years that life insurance, though an essential financial service, was seemingly run for the benefit of the industry and advisers through cosy commissions.

“Capping upfront commissions in a way which ensures we can get transparent access to the kind of policies and advice, satisfying our best interests as consumers, is surely paramount,” he added.

Fast-rising premiums, issues of affordability, low coverage and complexity along with a great deal of difficulty in comparing life insurance products, in and out of superannuation need to be addressed. The Trowbridge and ASIC reports show what needs to be done and how it can be achieved.

Adviser Ratings believes it is ironic that the sales-driven culture from the early days of life insurance, helped the conflicted remuneration business models evolve, damaging the wider financial advice sector.

“Life insurance, for reasons the public never understood, was carved out of the Future of Financial Advice (FoFA) reforms. Now is the change while FoFA is becalmed politically to show how industry can reform its own house,” concluded Mr Zinn.