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NIBA keeps eye on ASIC funding costs

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The National Insurance Brokers Association (NIBA) will monitor costs paid by member companies to fund the Australian Securities and Investments Commission (ASIC), after providing information to help ease the burden.

“NIBA has used its general insurance broker findings to help reduce the funding the Federal Government has now decided to collect from the finance sector to the tune of $240 million,” President Tim Wedlock told the group’s annual convention in Hobart last week.

Instead of about $8000-$10,000 per licence per company, the costs are more likely to be in the vicinity of $2000, he says.

“These licence fees will be due in February [next year] and we will be watching carefully.”

Other recent reforms include introduction of the Australian Financial Complaints Authority (AFCA), which takes over from dispute resolution bodies including the Financial Ombudsman Service from November.

The maximum claim against insurance brokers will rise from $170,000 to $250,000, which compares with an increase to $500,000 for others in financial services, Mr Wedlock says.

He reminded the convention that licensees must become AFCA members by September 18.

NIBA has met with the International Monetary Fund, which is putting Australia under the microscope through its regular Financial Sector Assessment Program.

Mr Wedlock says the group promoted the role of brokers and tapped Vero SME Index data to show there are fewer small business complaints when a broker is involved.

NIBA will push ahead with a review of the code of practice and look to raise minimum standards of education, he says.