The Association of Financial Advisers (AFA) will continue to push the Federal Government to focus on both commissions and the lack of insurance cover.

AFA CEO Richard Klipin says the association has focused on working with the Government and regulators on remuneration arrangements for life advisers.

“It is a system that has served everybody well,” he told insuranceNEWS.com.au.

“But the real issue is the levels of cover and how to deal with the yawning gap between those with insurance and those without.”

Currently life advisers are paid a commission, or “trail”, for as long as the policy remains in force, although they do have the option of forgoing these payments.

In some cases this can be many years, and it is not unknown for the client to be on-sold to another practice when the original advisers retire.

InsuranceNEWS.com.au has been told there are a considerable number of life insurance policies that are more than 20 years old.

These would have paid a commission during that period to the selling adviser or whoever now advises on the policy.

However, obtaining exact figures has proved hard to find.

“Let’s not tinker with the current system that has significant implications if it is changed,” Mr Klipin said.

Also see ANALYSIS.