An
ASIC representative has praised the insurance broking industry for its conduct but issued a challenge for the industry to not stand by if it witnesses any wrongdoing.
“I would argue that the focus and scrutiny on the insurance sector is broader and more intense than we have seen, perhaps, ever before,” Kell said. “Insurance brokers are not so much in the frame for us. The insurance broking area is not one that generates some of the same sorts of issues to the same degree as other sectors.”
One area Kell chose to highlight was that of add-on insurance. Kell said that too many in the industry knew of the issues surrounding add-on cover and did not speak out, which has led to a lack of consumer trust and increased scrutiny of the industry. While brokers may not be directly involved in the sale of add-on insurance, Kell said that the issue offers the industry an example of how to self-regulate and raises concerns for the benefit of both consumers and the industry itself.
“One of the things that we’ve been pleased about is that often the information we get about poor conduct on the part of brokers comes from other participants in the industry. I would encourage you to keep reporting problems you see, don’t just let them drift by and assume someone else will make that call,” Kell continued.
“My question to you...is there anything like this [add-on insurance] that you are walking past? It may not be in your business, you may be doing a great job, but is there anything like this you are walking past more broadly?”
Kell noted that last year, ASIC banned 45 financial advisers in one of its most active years to date but only six of those were brokers.
Related stories:
ASIC released its PI insurance review findings
