General insurance should remain exempt from the ban on conflicted remuneration, the National Insurance Brokers Association (NIBA) has told the Hayne royal commission.

Whether monetary and non-monetary benefits given in relation to general insurance should remain exempt is among issues raised in the commission’s policy questions document following last month’s hearings on insurance.

“NIBA’s response is yes,” the association says in a submission. “NIBA is strongly of the view there has been nothing identified in the hearings or otherwise regarding insurance broker conduct that would reasonably support a recommended change from the exemption as it applies to general insurance brokers.

“In NIBA’s view, the information shows the insurance broking profession is generally acting professionally in the interest of customers, relevant law and community standards and expectations, and recommendations for change based on a principle alone would not be likely to be in the community interest.”

NIBA cites the low incidence of complaints and disputes to the Financial Ombudsman Service (FOS) as justification for the status quo.

While general insurance disputes made up 32% of FOS member disputes last financial year, only 181 were related to brokers, and the figure was down from 216 in 2016/17.

“FOS’ submission to the royal commission in relation to general insurance disputes and life insurance disputes does not mention insurance broker conduct as being of concern,” NIBA says.

“NIBA acknowledges and submits that while general insurance brokers are treated differently in some respects, this is justified because the protection regime that applies to insurance brokers is working and properly protects clients and consumers.”

Consumer advocates have called for a ban on conflicted remuneration to fix “systemic problems” uncovered by the royal commission.