Proposed changes to life insurance advice remuneration under the Corporations Amendment Bill may cost consumers, the National Insurance Brokers Association (NIBA) says.

NIBA members have expressed concern at a number of proposed changes including clawback arrangements, setting a maximum commission level, ongoing reporting to the Australian Securities and Investments Commission (ASIC) and regulation impact statements.

“It would appear these proposals will result in significant cost burdens for life insurance advisers and their clients,” NIBA says in a submission to the Senate Economics Legislation Committee. “In addition, there are likely to be non-financial impacts across the community as a result of these reforms.

“It is unfortunate there has been no regulatory impact statement to assess the benefits – and, most importantly, the costs – of the proposed regulatory approach.”

On clawback arrangements, NIBA proposes ASIC hold further discussions with life insurers and advisers on an appropriate set-up.

Some industry estimates put the number of likely redundancies in the life advice sector as high as 17,000 if the proposed changes are made.

“It will indeed be an unfortunate outcome for the community if fewer clients seek advice as a result of the amendments to the Corporations Act and the proposed regulatory approach for the implementation of that legislation by ASIC,” NIBA says.