ACCC Strengthens Position Against Broker Commissions
ACCC Strengthens Position Against Broker Commissions
1
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
In a recent submission to the professional code of practice review, the Australian Competition and Consumer Commission (ACCC) has reiterated its position against broker commissions.
Echoing findings from its 2020 Northern Australia Insurance Inquiry, the ACCC advocates for extending the ban on conflicted remuneration to include brokers.
The issue stems from the practice where broker commissions are often based on premium amounts, potentially discouraging brokers from pursuing more cost-effective coverage or options that pay lower or no commissions for clients. Despite full disclosure of such remuneration to consumers, the ACCC argues that the inherent conflict remains problematic.
ACCC Chair Gina Cass-Gottlieb, in the submission, underlined that while some consumers might resist an upfront fee akin to commissions, the transition challenges away from conflicted remuneration models do not justify retaining exemptions permitting them. This echoes a broader reform ethos initiated by the federal government in 2023, stipulating that brokers must secure client consent to receive commissions when providing personal advice.
NSW Fair Trading, in its independent review of strata sector practices, has also highlighted the need for the broking code of practice to enhance commission practices. Commissioner Natasha Mann advocates for bolstered disclosure obligations, promoting transparency in brokers' remuneration and ownership structures, coupled with robust compliance monitoring mechanisms.
Further perspectives include those from consultant John Trowbridge, who supports the continuation of commissions but emphasizes the necessity for brokers to transparently disclose all commission-related earnings. Trowbridge also suggests that the National Insurance Brokers Association offer guidelines to elucidate conflict management and fiduciary responsibilities within the industry.
The WA Small Business Development Corporation has expressed support for widening the disclosure requirements scope, advocating for the inclusion of small businesses. By aligning with the Australian Financial Complaints Authority rules, small enterprises, often with limited resources, stand to benefit from an expanded definition that enhances clarity on financial incentives influencing broker services.
The industry awaits further developments from the review, led by Phil Khoury, as its submission deadline approaches.
Published:Friday, 2nd May 2025 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
The Australian Prudential Regulation Authority (APRA) has announced a significant policy change aimed at mitigating risks in the housing market. Effective February 2026, APRA will impose a cap on high debt-to-income (DTI) home loans, limiting such loans to 20% of new home lending. This measure applies to both owner-occupiers and investors, with the exception of new housing developments. - read more
CHU, Australia's leading strata insurance underwriting agency, has released its 2025 State of the Strata Market report, providing a comprehensive analysis of current industry trends and challenges. The report indicates that strata insurance premiums have experienced a modest increase of 2.8% over the past year, rising from an average of $954 to $981 per lot annually. This growth rate is notably lower than the 3. - read more
The New South Wales (NSW) government has introduced a new tranche of strata reforms to parliament, aiming to enhance the maintenance and safety of apartment buildings across the state. A key component of these reforms is the proposal to grant NSW Fair Trading the authority to enter any apartment building without a warrant if there are reasonable grounds to believe that the owners corporation is failing to maintain common property adequately. - read more
The Australian Competition and Consumer Commission (ACCC) has recently blocked Insurance Australia Group's (IAG) proposed acquisition of RAC Insurance Pty Limited. This decision underscores the regulator's commitment to maintaining competitive dynamics within Western Australia's insurance market. - read more
Recent supercell thunderstorms in South East Queensland and northern New South Wales have led to a surge in insurance claims, prompting Suncorp to reach its maximum reinsurance retention of $350 million. The insurer has reported over 10,000 claims related to these events, with approximately half pertaining to home damages and the other half to motor vehicles. - read more
The National Truck Accident Research Centre (NTARC) has released its latest Major Incident Investigation Report, highlighting inattention, distraction, and inappropriate speed as the most frequent human factors behind major truck crashes in Australia. While there has been a modest reduction in these incidents compared to previous years, they continue to pose significant risks to road safety. - read more
The Australian insurance industry is witnessing a significant shift as mental health conditions have become the leading cause of total and permanent disability (TPD) claims. Recent data from the Council of Australian Life Insurers (CALI) indicates that mental health issues now account for nearly one-third of all TPD claims, marking a substantial change in the industry's claim patterns. - read more
In a remarkable turnaround, Australian general insurers have reported a combined profit of $6.1 billion over the past year. This substantial increase is attributed to a period of relative calm in natural catastrophes and robust investment returns. - read more
Recent findings have revealed that certain Australian life insurers continue to implement blanket exclusions for mental health conditions, a practice that contravenes the industry's code of practice. This has raised significant concerns about the fairness and legality of such exclusions. - read more
In a significant development for Australia's marine insurance sector, Rhodian Group has announced the launch of Marinex Underwriting, a specialised agency dedicated to addressing the complex insurance needs of the marine industry. This initiative marks Rhodian's third agency launch, following the establishment of Halo Underwriting and Batch Underwriting in previous years. - read more
In the world of agriculture, having the right insurance coverage is essential. Farming is a high-risk industry that deals with unpredictable elements, and insuring your farm equipment can safeguard your livelihood. - read more
Crop insurance is a type of insurance policy designed to protect farmers from the financial losses that arise from damages to their crops. This could be due to various risks, including adverse weather conditions, pests, and diseases. - read more
Farming in Australia is not just a job, it's a way of life. However, it’s also a livelihood that comes with its own unique set of risks. From unexpected weather events to machinery breakdowns, the life of an Australian farmer is fraught with uncertainties. - read more
Australian farmers face an array of natural disasters that can threaten livelihoods and disrupt the delicate balance of agricultural ecosystems. From devastating bushfires and droughts to powerful storms and floods, these catastrophic events pose serious risks to the farming community. Understanding and preparing for these forces is not just about survival; it's about building a sustainable future for farms across the continent. - read more
Hobby farming has become increasingly popular in Australia, with many individuals and families embracing the joys of growing their own produce, raising livestock, and enjoying a rural lifestyle. Whether it's a small vegetable garden, a few chickens, or a larger mixed farming operation, hobby farms offer both relaxation and a connection to nature. - read more
Farming is inherently risky. With factors like weather, pests, and market fluctuations affecting crops, it's crucial to manage these risks effectively. - read more
As the backbone of Australian agriculture, farm equipment plays an essential role in day-to-day operations across our expansive and diverse landscapes. From the vast wheat belts to the tropical fruit farms, machinery ensures efficiency and productivity in the face of constant challenges. But with reliance on such equipment comes significant risk—the financial burden of damage or loss can be devastating to a farmer's livelihood. - read more
Welcome to our comprehensive guide on navigating the complexities of farm insurance for Australian farmers. As an integral part of the agricultural industry, insurance provides a safety net that helps secure the livelihood of farmers against unpredictable events that can lead to financial hardship. From property damage due to natural disasters to loss of livestock or crops, having adequate farm insurance can make all the difference in keeping a farming operation afloat in times of crisis. - read more
Farming is a vital industry in Australia, requiring significant investment in equipment, crops, livestock, and labour. As with any major investment, protecting it is crucial. That's where farm insurance comes in. - read more
Farming is much more than an occupation; it's a way of life and a heritage that often spans generations. In today's ever-evolving agricultural landscape, embracing modern practices while preserving your farm's future has never been more crucial. Estate planning emerges as a pivotal strategy for safeguarding your agricultural legacy, ensuring that your hard-earned investments and the land you hold dear are passed on according to your wishes. - read more
Need a Quote?
Start your free farm insurance quote comparison here.
Knowledgebase
Proximate Cause: The primary cause of loss in an insurance claim, which sets in motion a chain of events leading to the damage or injury.