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Liberty Specialty Markets

Hayne delivers final report to Governor-General

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Commissioner Kenneth Hayne today submitted his final report on financial services misconduct to Governor-General Sir Peter Cosgrove, as the insurance industry braces for potential impacts.

“The submission of the report brings to an end an extensive inquiry,” the royal commission said in a statement today.

“Over the course of its work the commission reviewed over 10,000 submissions from the Australian public, completed 69 days of public hearings and considered thousands of documents provided by entities, regulators and consumer advocacy groups.”

Insurers and brokers will have to wait to find out the report’s recommendations, with Treasurer Josh Frydenberg saying the report will be released at 4:10 pm on Monday, after the close of trading on the Australian Securities Exchange. will publish the insurance-specific results shortly after.

Mr Frydenberg said in an opinion piece published in the Australian Financial Review today that the Government’s principal focus in considering the commissioner’s final report “is on restoring trust and confidence in our financial system and delivering better consumer outcomes”.

“Trust is at the core of the financial system and, as we have seen, once it is lost it is not easily regained. Customers need to be able to trust that the institution or individual they are dealing with is putting their interests first.”

The JP Morgan Taylor Fry General Insurance Barometer released earlier this week says the royal commission report may affect a number of areas related to the sector.

“Although the insurance industry has been less exposed to the financial services royal commission than wealth or banking companies, the final report will likely have important implications for insurers and brokers,” JP Morgan Insurance Analyst Siddharth Parameswaran said.

Distribution practices and broker commissions may be targeted and the Hayne inquiry is likely to promote measures to improve transparency, according to the report.

Contract terms could become more standardised, the royal commission could lead to legislative changes to ensure fairer handling of claims and the extension of unfair contract terms provisions to insurance is a possibility.

The royal commission held seven rounds of hearings, ranging across lending, financial advice, insurance, superannuation and issues affecting remote and regional communities.

More than 170 written submissions were received in response to policy issues raised after the insurance round of hearings.