The Association of Independently Owned Financial Planners (AIOFP) is lobbying for a 25% reduction in professional indemnity insurance for its members as premium increases come into effect.

Last week the association, along with its brokers Marsh, met with five of Australia's top underwriters to ask for a discount, highlighting the quality of its members and showcasing a new product research initiative to help mitigate risk.

Executive Director Peter Johnston told insuranceNEWS.com.au AIOFP's 170 members, which represent 2500 advisers, are independently owned so there is no conflict of interest and members work on a fee-for-service basis.

"Over the past 20 years retail research houses have badly let the industry down because products that shouldn't be approved have been recommended mainly due to conflict of interest," he said.

AIOFP has appointed Marsh sister company Mercer and Sydney firm McGregor Tan Research to put together a recommended list of products that are constantly monitored.

Mr Johnston says Marsh was happy with the meetings and all the underwriters believe it's a step in the right direction. The association hopes to launch the new scheme at its conference in early October.

"It doesn't matter how professional a firm is and whether everyone is qualified or not, if their recommended list is corrupted it's an accident waiting to happen," he said. "Bad advice is cleared up by the Financial Ombudsman Service but big product failure is what kills the market."