The Australian Securities and Investments Commission (ASIC) is seeking submissions on proposals to offer exemptions for some entities that arrange group insurance, such as sporting and community associations.

Given the role of certain kinds of insurance arrangers, the corporate regulator says strict compliance might be “disproportionately burdensome” due to the cost of holding an Australian financial services licence and registering a managed investment scheme.

It is seeking feedback on whether there should be exemptions from certain licensing provisions of the Corporations Act.

ASIC says when group purchasing entities are small industry bodies or not-for-profit associations it may not be economical for them to obtain a licence or register a managed investment scheme.

Without relief, insurance costs for consumers may increase and there may be less availability of cover for consumers.

Government and regulation expert John Hanks told Sunrise Exchange News exemptions will be good news for sporting and not-for-profit groups.

“If they won’t be required to obtain an AFS licence then it’s good news, but we’ll need to check whether it’s appropriate and find out if there are any conditions.”