Enforceable code needed for insurance in super

A voluntary code of conduct is not good enough for insurance within superannuation, according to the Australian Lawyers Alliance (ALA).

The ALA has called for an enforceable Code of Practice to regulate the conduct of both the insurance and superannuation industries, overseen by the Australian Securities and Investments Commission (ASIC).

In its submission to the Senate Economics Committee inquiry into consumer protection in the banking, insurance and financial sector the ALA said the many examples of poor claims handling had eroded public confidence in the insurance industry “such that a self-regulated code would be insufficient, and would represent a wasted opportunity to effect genuine change”.

Related News:

It said the proposed code should ensure that the insurance and superannuation industries operated in an ethical and fair manner.

“It should be developed through an open and transparent process, involving genuine consultation with both community representatives and industry groups,” it said.

The ALA argued that ASIC was the appropriate regulator, adding that it was essential that “ASIC’s resources are sufficient to ensure it is capable of providing genuine and effective oversight”.

“At a minimum, ASIC supervision should cover total and permanent disability insurance, income protection, terminal illness, death and trauma claims,” it said.




Related Content

Making super come alive

Getting superannuation fund members to talk about their super before they turn 50 has always been a difficult task. The intangible nature of super cou...more

Property investors exposed to structural risks

Investment properties are the second largest sector for investments outside superannuation and Australians face a myriad of structural risks when hold...more

Govt blocks estate planning options within CIPRs

The Federal Government has moved to ensure that it closes off estate planning options within its changes to post-retirement income stream products.The...more

Author

Comments

Add new comment