Life Code: Where are we?

By Lachlan Colquhoun

Almost half of all participants in a Plenary session at the FSC Life Insurance Conference believe that the industry’s new Code of Practice should be approved and adopted by ASIC.

A question put to the audience by session moderator Nick Kirwan, the FSC’s Policy Manager - Life Insurance, saw 49 percent of those present say the current code, which came into effect on June 30 last year, should be adopted by the regulator.

A further 34 percent were more cautious, saying that ASIC approval should come after the second revised version of the code, the so called 2.0 version, had been finalised.

Other responses were the 13 percent who said the existing code should be adopted by the regulator when it was “more embedded,” while only 4 percent thought ASIC approval was a “bad idea.”

The consensus among the panel, comprising Alexandra Kelly from the Financial Rights Legal Centre, Zurich chief executive Tim Bailey and the Head of Life Insurance at ANZ Wealth, Gerard Kerr, was that the existing code was already having a positive effect on consumer trust and engagement.

“The code is an important step as a platform for change,” said Tim Bailey.

“It is a benchmark from which we can all build, and bridge the gap in trust.”

Nick Kirwan reminded Alexandra Kelly that at the 2016 conference she had said that if the progress and impact of the code was a journey between Sydney and Melbourne, she had replied that it was “stuck in the traffic somewhere in Campbelltown (on Sydney’s outskirts).”

He asked her where she believed it was now on this journey, using the same analogy.

“I change my view as to where we are at, and that depends on interactions with consumers,” said Alexandra.

“Sometimes I feel we are on the Hume at a good speed heading south, then we have an issue and it’s a U-turn.

“Do we think we are past the border in Victoria or are we still in NSW? That is a question I would put to industry?”

Zurich’s Tim Bailey said he believed that the fact that the industry was currently in debate about the 2.0 version was a sign of progress.

“We are just not talking about the compliance with the existing code,” he said.

From ANZ, Gerard Kerr took the Sydney to Melbourne analogy and said that progress was “taking a stop in Canberra at present” but this was good as there were “important stakeholders there.”

“I just hope we don’t get stuck in all those roundabouts,” he said.

“The question though is where do we want to get to after Melbourne, because this is a journey that will carry on.”

A second question to the audience was whether the current code had “set the bar at the right level” in terms of appropriate standards.

The majority (58 percent) said they believe it is “about right,” while 38 percent believe it is “too low.”

Only 4 percent responded that they believed the Code’s standards are “too high.”