The Association of Financial Advisers (AFA) has called for substantial improvements to the draft Life Insurance Code of Practice, even if it means delaying the planned start date.

“It is not good enough to simply say this code is a step in the right direction and can be further improved later through future reviews, because as it currently stands, it falls too far short,” AFA CEO Brad Fox said.

The Financial Services Council’s code is due to take effect from Saturday, with a transition period until June 30 next year. A public consultation closed on September 9.

The AFA says about 50% of life cover is arranged with the support of advisers, but the profession’s role has been ignored.

“Restricting the code to setting out best-practice standards for insurers in relation to underwriting and claims management does not go far enough in addressing the cultural issues and sales practices that work against consumer interests,” Mr Fox said.

The AFA says the code should drive a culture of seeking new business and helping address Australia’s underinsurance problem, rather than perpetuating a culture of attracting policyholders away from rivals.

It makes 29 recommendations in its submission

The Financial Planning Association has also criticised the proposed code for being too complex and ignoring the role of advisers.