The revamped Insurance Brokers’ Code of Practice contains 12 key standards, adopts new requirements on clients’ best interests and is written in a more consumer-friendly manner, according to the National Insurance Brokers Association (NIBA).

Members will have more than a year to familiarise themselves with the code, which takes effect on January 1 2014.

NIBA is also planning an extensive information and training program to raise awareness.

CEO Dallas Booth says the standards cover the main client service-related requirements that regulators are likely to focus on, and adopt the new statutory “best interests duty” for retail and wholesale clients.

The current code was introduced in 2006. The new version, launched at the NIBA Convention on the Gold Coast yesterday, follows a review by Professional Financial Solutions (PFS) and adopts almost all of the 41 recommendations.

Mr Booth says the updated wording makes the code clearer for consumers with limited understanding of insurance and promotes brokers’ professionalism and integrity.

“It does not look like a legal document or an act of parliament,” he told insuranceNEWS.com.au.

PFS found lack of awareness of the code was a major issue, both among clients and some broking staff. Mr Booth says NIBA’s information program will explain why the code is important and how it can benefit brokers’ businesses.

“It is not a regulatory tool, it is a positive message,” he said. “It is not much use having a code like this unless you are proudly telling your customers in the community about it.”

The new code requires NIBA to establish an independent code compliance committee to oversee administration of the code by the Financial Ombudsman Service (FOS). Talks are under way on forming the committee, which will have a consumer representative.

Mr Booth says this will bring brokers into line with other industry codes.

All NIBA members are bound by the code, while another 42 parties have entered a deed of adoption and also subscribe to it.

The PFS report says FOS has not identified any breaches of the brokers’ code in recent years and has handled only 80 disputes with brokers in the past two years.

“On this evidence, both the code of practice specifically and the operations of brokers generally appear to be working well, with no obvious systemic issues,” it says.

The PFS report says NIBA’s separate code of conduct should also be reviewed.