Risk Product, Company and Regulatory Updates as at 10 July 2017

Company Updates

Easton to acquire advice group
Easton Investments is in talks to acquire GPS Wealth, a financial planning network. Easton has reached a formal conditional agreement with GPS's majority shareholders to acquire their shares, in addition to a proposal to minority shareholders. The maximum consideration for GPS is $20 million.

AIA launches health website
AIA Australia has launched its new website, OneLife, which aims to support Australians with their health and wellbeing goals. The website will contain articles written by AIA Vitality ambassadors Alisa Camplin, Chris Judd and Shane Crawford.

Fortnum partnering with fintech company
Fortnum Financial Advisors is partnering with MoneySoft, a provider of real-time data, budgeting and reporting software, to assist in efforts to improve clients' financial literacy and spending habits. This follows MoneySoft's similar agreements with Clearview, RI Advice, Millennium3, Link Group and Mortgage Choice.

Optimo launches automated advice platform
Optimo Financial is releasing Optimo Pathfinder, a personal finance modelling system that aims to make the provision of goals-based financial advice simpler. The solution will improve clients' financial strategies to best achieve financial goals, accounting for tax and superannuation legislation, family tax benefits, the age pension and other factors.

Regulatory Updates

MLC partners on underwriting solution
MLC Life Insurance has partnered with Pacific Life Re to release a new underwriting rules solution to significantly reduce the time it takes to receive cover. The solution, UnderwriteMe, is able to provide an instant quote on premiums for life insurance by using a database of industry standard questions to assess lifestyle and health factors. This will allow MLC Life to ask fewer, more relevant questions in order to produce a more accurate risk assessment.

FSC finalised trauma definition
The Financial Services Council (FSC) has added minimum standard medical definitions to its Life Insurance Code of Practice (LICP), effective 1 July. Definitions of cancer, heart attack and stroke have been added and will apply to the first $2 million in trauma and critical illness policies issued from 1 July. The FSC also announced an independent, three-member Life Code Compliance Committee (LCCC) to oversee compliance with the LICP and be administered by the Financial Ombudsman Service.

ASIC further clarifies use of 'independent'
ASIC has further clarified the use of terms such as 'independently owned', 'non-institutionally owned' and 'non-aligned'. Following legal advice, use of the words has been restricted to advisers who do not receive any commissions or volume-based payments, or other gifts or benefits and have no conflicts of interest or influence from any product issuer. ASIC has provided a six-month compliance period to allow changes to websites and documents.

Call for commission ban
Industry Super Australia (ISA) and the Australian Institute of Superannuation Trustees (AIST) have called for a ban on up-front and trailing commissions to be extended to cover all individual and group life insurance polcies. The two groups stated that it is difficult to see how the Future of Financial Advice (FoFA) could align the interests of advisers with clients as the ban does not apply to all life insurance.