Proposed changes to who can give financial advice in Australia has caused “deep concern” among those running industry body the FAAA. It says the reforms announced by the Government’s Financial Services Minister Stephen Jones could wind the clock back five years.
However, the move has been welcomed by insurance companies across The Ditch, with lobby group CALI saying Australian consumers are the big winners, as it will “…allow life insurers to provide simple advice directly to their customers”. (see: Insurers Welcome Financial Advice Reform Package).
Sarah Abood, the FAAA’s CEO, says there is little detail available “…but on the face of it we are deeply concerned at the direction of these announcements”.
“Our members fear this could be winding the clock back five years on our profession,” she says. “It appears to invalidate the hard work and pain that has been involved in creating financial advice as a profession and winning the trust of consumers.”
Abood says that specifically, the Minister said “…any financial institution will be able to provide personal financial advice to consumers, using people who are not financial advisers – yet [they] would be called ‘qualified advisers’.
“…these ‘qualified advisers’ will provide something that passes for advice for free, confusing clients and obscuring the important differences between information from a partly-trained salesperson, and comprehensive financial advice from a fully qualified professional.”
Justin Delaney, CEO, Zurich Australia & New Zealand says the proposed government package “…strikes an appropriate balance, prioritising consumer protections whilst also recognising significant unmet financial advice needs and a widening insurance protection gap.”