Risk Product, Company and Regulatory Updates as at 25 June 2019

Product Updates

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OnePath trauma definition update
After a review, over 600 trauma definitions have been updated by OnePath, with the updated definitions to apply to new events across 60 products from 1 December 2018. The changes are in line with the Financial Services Council (FSC) life insurance code of practice.

Zurich launches wellness program
LiveWell is Zurich’s new health and wellness program, designed to encourage policyholders to be healthier physically and mentally. The program takes on a more holistic bent, including a sense of community as an important pillar of the program. Premium discounts are available when certain tiers of accomplishments are reached, with some examples of activities including lowering body mass index, giving blood or achieving a certain number of steps each day. Discounts for specific clubs and organisations are available, for example Jenny Craig for weight loss.

AFA and MetLife launch grant program for female advisers
A new grant program, MetLife Progress: Professional Development Grant for Women, was developed to help women reach their career goals within the financial planning industry and advocate for gender diversity. The first grant round is offering up to 15 packages, with each package containing a 2019 AFA Conference registration, AFA events such as masterclasses, and events with networking and support from MetLife Australia.

To qualify, applicants must be female-identifying, have up to five years of experience in financial planning or paraplanning as at 24 June 2019, not attended an AFA Conference, and have an AFA membership. Applications close Friday 12 July 2019.

Company Updates

Fiducian buying MyState financial planning client book
MyState has entered into a sale agreement with Fiducian to buy the bank’s Tasmanian retail financial planning business. Fiducian is paying $3.5 million for MyState’s client book, which has over $340 million in funds under advice. MyState is an ASX-listed financial services group made up of MyState Bank and Tasmanian Perpetual Trustees.

Regulatory Updates

FASEA approves diplomas, bridging programs
The first set of current and historical bridging courses and diplomas from various education providers has been approved by the Financial Adviser Standards and Ethics Authority (FASEA). Thirteen current graduate diplomas, eight historical graduate diplomas, and 11 bridging courses have been approved.

The approved list includes courses from these providers:

  1. Australian Catholic University

  2. Charles Sturt University

  3. Deakin University

  4. Swinburne University

  5. University of Newcastle

  6. Western Sydney University

  7. Kaplan Professional

CFP completes EU requirements
The enforceable undertaking (EU) ASIC entered into with Commonwealth Financial Planning (CFP) regarding fees for no service has been completed. The compliance and obligations under the EU are now finalised, except for some remaining payments to clients, while all the advisory firm’s systems meet ASIC’s criteria and are ‘reasonably adequate’.

ASIC approves AFCA rules for small businesses and consumers for old complaints
Complaints directed at financial firms can now be made dating back to 1 January 2008 after new rules were approved relating to the Australian Financial Complaints Authority (AFCA). AFCA has a 12-month window to accept and investigate the complaints, which must not have already been dealt with by another body. Previously these complaints may have been deemed outside of the jurisdiction of previous schemes and therefore not addressed.

Update on AFA and FPA task force
The Association of Financial Advisers (AFA) and the Financial Planning Association of Australia (FPA) have released more details regarding the joint life insurance task force set up to promote the use of commissions for risk insurance in Australia, and to present a united front to regulators. The task force is two years shy of ASIC’s review of the Life Insurance Framework reforms, being led by eight people, an even split between the two industry associations.

Guarded loses key person and then AFSL
ASIC has cancelled the Australian Financial Services (AFS) licence of Guarded Pty Ltd after it failed to comply with financial services law. Its responsible manager, who was the appointed key person, resigned, and the company failed to notify ASIC or find a replacement. A key person is appointed in some companies where the licensee is dependent on that person to maintain the capacity, knowledge and skills to provide the financial services under the licence.

Additionally Guarded did not lodge financial statements or auditor’s reports for the past two financial years. ASIC has concluded that the licensee did not understand its responsibilities as an AFS licensee, and thus has cancelled the AFS licence.