Australians looking for more ways to get affordable financial advice are the big winners following the Federal Government’s promise of widespread advice reforms as early as next year.
The Council of Australian Life Insurers (CALI) welcomes the Government’s announcement on the second phase of its Delivering Better Financial Outcomes package, which will give Australians more choice about where and how they get advice on their life insurance needs.
“This is a big win for all Australians who want to secure their financial future. The positive impacts of these reforms will be felt over generations,” said CALI CEO Christine Cupitt.
“This had to happen. We can’t continue to have almost three and a half million people in this country who are underinsured and unprotected when times get tough.”
It comes after more than 18 months of close collaboration between the life insurance industry and the Government to address Australia’s advice accessibility crisis, particularly for people who can’t afford to pay for a financial adviser in the current cost of living environment.
Under the Government’s reforms, life insurers will be able to provide simple advice to both existing and new customers when they ask for it, at no extra cost to them.
“These reforms will allow Australia’s life insurers to provide a better customer experience to the millions of people they serve every day.
Of course, this will only happen with strict consumer protections and appropriate qualifications to ensure that this is a reliable, trusted and safe choice for people looking to get advice about their life insurance needs.”
Currently, life insurers are restricted to providing customers with advice that is general in nature only.
Independent research commissioned by CALI shows that more than 40 per cent of people want advice that’s more personalised and helps them decide how much cover they need and the products that best suit them. This is the kind of advice life insurers would be able to provide under the Government’s reforms.
“Our research shows that only a quarter of people want basic information only, proving just how critical these reforms will be to giving Australians the kind of advice they want, when and where they want it.
Giving people more access to affordable advice is critical to helping them build strong financial safety nets for themselves and their loved ones.”