MLC Life Insurance has highlighted the need to ensure Australians have access to advice as the industry awaits the release of an interim paper from Quality of Advice independent reviewer Michelle Levy.

“We must do what’s right for our customers and their advisers, which means ensuring more advice, not less,” GM for Retail Distribution Partnerships Michael Downey said.

“The recommendations we have put forward to Michelle Levy and her team are reasonable and we look forward to working closely with them over the coming months to ensure a positive outcome for all Australians.”

The Quality of Advice Review interim paper, expected soon, is likely to include proposals for reforms. Industry submissions to the review have generally pushed back against calls to axe the commission remuneration model, saying an upfront fee arrangement will deter Australians from seeking professional financial advice.

MLC Life Insurance says it believes all options should be considered to make advice more affordable for those that receive it, and more cost effective for those that provide it.

Successive and ongoing regulation of risk advice is leaving too many Australians without protection, and therefore vulnerable to life events.

Mr Downey says after years of “inordinate regulation, however well intentioned, we are haemorrhaging advisers who provide critical advice to clients in their time of need”.

“The trend is not sustainable,” he said. “Unless we take steps to reduce the cost of advice, I have a real fear that only the wealthiest Australians will be able to afford to see an adviser.

“That means fewer people will have appropriate life insurance protection for their needs and they will fall through the cracks. Where is the fairness in that outcome?”

MLC Life Insurance says its research shows unless advisers can remove 20-25% of the current cost base for each business, advice will not be profitable, leaving many Australians to make important financial decisions on their own.

Providing consumers with a choice in how they want to pay for advice is one way of ensuring the sustainability of the advice sector.

“To have a sustainable advice sector, commissions must continue to remain an option that supports everyday Australians having access to much-needed financial advice during key life moments,” MLC Life Insurance says.

“This includes maintaining the Life Insurance Framework.”