PI deadline not an issue for FPA members
The July 1 deadline for all financial services licensees to have “adequate” professional indemnity (PI) insurance isn’t worrying the Financial Planning Association (FPA).
Under ASIC’s Regulatory Guide 126: Compensation and insurance arrangements for AFS licensees, financial planners are required to have PI insurance that includes cover against fraud, external dispute resolution scheme awards and run-off cover for at least a year.
FPA CEO Jo-Anne Bloch said on Friday the ASIC deadline isn’t an issue for FPA members as they all already have individual PI cover.
“All FPA members are required to have PI insurance as a condition of their membership,” she said.
This is despite the FPA calling for tender submissions in March for the provision of a group PI policy to deliver regulatory coverage for FPA members, saying it would have a policy in place by June 2.
However, a spokesman told insuranceNEWS.com.au the initiative is not related to ASIC’s PI decision.
Ms Bloch said at the time a group policy was needed to provide members with the confidence that their businesses are covered.
“Over the past few years the number of insurers offering PI cover to financial planners has greatly reduced,” she said in March. “Our members have also tabled concerns with regards to the variety of terms and conditions available, and the limitations that come with commercial arrangements.”
QBE announced in April it was withdrawing its PI and directors’ and officers’ product lines for financial planners and stockbrokers, with effect from June 1.
Under ASIC’s Regulatory Guide 126: Compensation and insurance arrangements for AFS licensees, financial planners are required to have PI insurance that includes cover against fraud, external dispute resolution scheme awards and run-off cover for at least a year.
FPA CEO Jo-Anne Bloch said on Friday the ASIC deadline isn’t an issue for FPA members as they all already have individual PI cover.
“All FPA members are required to have PI insurance as a condition of their membership,” she said.
This is despite the FPA calling for tender submissions in March for the provision of a group PI policy to deliver regulatory coverage for FPA members, saying it would have a policy in place by June 2.
However, a spokesman told insuranceNEWS.com.au the initiative is not related to ASIC’s PI decision.
Ms Bloch said at the time a group policy was needed to provide members with the confidence that their businesses are covered.
“Over the past few years the number of insurers offering PI cover to financial planners has greatly reduced,” she said in March. “Our members have also tabled concerns with regards to the variety of terms and conditions available, and the limitations that come with commercial arrangements.”
QBE announced in April it was withdrawing its PI and directors’ and officers’ product lines for financial planners and stockbrokers, with effect from June 1.