Powered by MOMENTUM MEDIA
subscribe to our newsletter

ASIC releases findings from PI review

A new report from the corporate watchdog has found that gaps exist in the market for professional indemnity insurance for financial advisers between what ASIC expects and some of the insurance products available.

All Australian Financial Services (AFS) licensees must have arrangements to compensate clients and generally this means holding adequate PI insurance. ASIC's minimum requirements for PI insurance are set out in Regulatory compensation and insurance arrangements for AFS licensees (RG 126).

Released yesterday, the ASIC report into the market for the eight months to June 2015 found that while the market was basically sound, some PI insurance policies do not meet the requirements in RG 126.

The review was carried out in response to AFS licensee concerns about securing PI insurance and the high level of unpaid external dispute resolution scheme determinations.

“Advice businesses must have adequate PI insurance, and they should make sure this cover measures up with our requirements in RG 126,” ASIC deputy chairman Peter Kell said.

Advertisement
Advertisement

PROMOTED CONTENT


“ASIC will follow up with surveillance of advice licensees' PI insurance and if we find problems we will take enforcement action.”

The ASIC review was carried out between November 2014 and June 2015 and sought to understand the availability and cost of PI insurance.

This included testing the concerns ASIC has heard from some advice licensees over the past few years that they have been unable to secure PI insurance at a reasonable cost, and determining whether the insurance available conforms with ASIC’s guidance about what we consider to be adequate PI insurance – in particular, whether there are any significant deficiencies in the PI insurance that is generally available to advice licensees.

ASIC releases findings from PI review
mortgagebusiness

Latest News

OPINION: Debt-to-income ratio limits: do they help, or hinder? With the average property in Australian capital cities now over $700,000, l...

The Treasurer has met with regulators to discuss the housing market and consider whether “carefully targeted and timely adjustments” ...

The platform has become the first private sector exchange accredited under the ​​Trusted Digital Identity Framework. ...

Join Australia's most informed brokers

Do you know which lenders are providing brokers and their customers with the best service?

Use this monthly data to make informed decisions about which lenders to use. Simply contribute to the survey and we'll send you the results directly to your inbox - completely free!

How long do you think it should take to discharge a mortgage?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.