The Financial Planning Association (FPA) wants the use of the term “financial planner” restricted by law, while the rival Association of Financial Advisers (AFA) wants the term “financial adviser” given similar protection.

FPA Chairman Matthew Rowe says the use of the term “financial planner” should be restricted to members of an approved professional association and enforced by law.

“This would include life insurance advisers, who I see as a specialist financial planners,” he told insuranceNEWS.com.au.

“You can’t exclude them from the professional space.”

Meanwhile, the AFA says the term “financial adviser” should only be used by people with an Australian financial services licence (AFSL).

“Those who work under an AFSL are obliged by law to act in the best interests of their clients,” CEO Richard Klipin said.

“In the interests of properly protecting consumers, it is this distinction that they need to understand, so it makes sense to enshrine the term in legislation.”

Under the Corporations Act 2001 there is currently no constraint on individuals calling themselves financial planners or financial advisers, irrespective of their training, competence or licensing.

Mr Rowe wants financial planners to have the same status as tax agents and stockbrokers.

“The FPA believes this to be a fundamental public confidence issue,” he said. “Consumers deserve the right to differentiate between a qualified, professional financial planner and anyone who happens to hang out a shingle calling themselves a financial planner.”

Mr Rowe says life insurance advisers will be welcome at the FPA, as long as they complete the association’s life risk specialist’s accreditation program.

“In their own right they are professionals, and if a life specialist is an FPA member and signs up to the code of practice, I very much see them as part of the future of the financial planning profession,” he said.

“I think it is important to value life specialists in the association.”