The Financial Planning Association (FPA) has backed the proposed Life Insurance Framework legislation.

“This bill and the Life Insurance Framework package provide a sensible approach that will help ensure the sustainability of the life insurance advice industry, by providing businesses an appropriate amount of time to transition their business models,” it says in a submission to the Senate Economics Legislation Committee.

The FPA has welcomed two changes arising from discussions with the Government during the drafting process: a three-month grace period for the implementation of submitted policies at the end of the financial year; and grandfathering definitions of existing commission payments for businesses being sold.

“Lasting change in the life sector will ultimately be driven by higher professional standards, such as those adhered to by FPA members,” the submission says.

“In particular, we aim to drive a competitive, professional, and ultimately a valuable service to Australian consumers through a separation of life advice from life products.”