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17-422MR ASIC releases new example Statement of Advice for life insurance
ASIC has released a new example Statement of Advice (SOA) for life insurance as part of updates to Regulatory Guide 90 Example Statement of Advice: Scaled advice for a new client (RG 90).
The example SOA in RG 90 is designed to assist advisers to produce an SOA that is compliant, concise, easy to understand, and written in plain English.
The design is based on behavioural research into how consumers read and understand the information in SOAs. Following a public consultation, a draft of the example SOA was revised based on feedback and a subsequent roundtable with representatives from key financial advice industry associations.
Acting ASIC Chair, Peter Kell said the new example SOA has been designed to balance the interests of consumers with minimising regulatory burden on advisers. 'SOAs are a fundamental and important tool for an adviser to communicate their advice to the client,' said Mr Kell.
'We appreciate the feedback we received on the draft example SOA and have taken it on board in finalising the guidance.' said Mr Kell.
The updates to RG 90 and the example SOA arise from the Government's incoming life insurance advice reform package. As part of these reforms, ASIC was asked to consider how to improve consumer understanding, and adviser use, of SOAs. Consideration of prominent, upfront disclosure of commissions in SOAs was a component of the review brief.
- Regulatory Guide 90 Example Statement of Advice: Scaled advice for a new client (RG 90)
- Consultation Paper 284 Example Statement of Advice for life insurance: Update to RG 90 (CP 284)
- Report 557 Response to submissions on CP 284 Example Statement of Advice for life insurance: Update to RG 90 (REP 557)