Scaled advice should be allowed across all areas of the financial services industry, the Australian Institute of Superannuation Trustees (AIST) says in its submission on the topic.

It is also calling on the Australian Securities and Investments Commission (ASIC) to provide further examples of how scaled advice will work in a future regulatory guidance on scaled advice.

“The provision of examples further assists licensees how to go about proving this advice,” the AIST said in its submission.

“However we feel that ASIC needs to highlight the fact that the examples provided should not be taken as the limit of what advice can be scaled.”

To help advisers, the AIST wants ASIC to define what can be included in scaled advice and what is excluded.

“ASIC must then be willing to assist licensees to test the waters in scaled advice and provide rulings (similar to the tax office), so licensees feel they have the support of the regulator,” the submission says. 

“If licensees believe that they will be punished for scaling advice (which is the prevailing thought), then the goal of greater access to advice will not be achieved.”

The AIST also has an issue with one of the examples ASIC has used to explain scaled advice.

The regulator used an example in the consultative paper of a superannuation fund member wanting advice on the life insurance component of various funds.

The adviser in the example tells the client they should do their own comparisons. ASIC says this is good practice by not providing advice on this topic.

But the AIST wants the example removed, as it is “too general, simplistic and actually cause confusion”.