The Australian Securities and Investments Commission (ASIC) has delayed the launch of a new national financial adviser exam.

“ASIC views the exam as a very important initiative to ensure consistent national standards for advisers,” Chairman Greg Medcraft said.

“We will continue to explore options to implement this proposal at the appropriate time once the Future of Financial Advice reforms have been bedded down.”

In a submission to an ASIC discussion paper on training, the National Insurance Brokers Association (NIBA) argues against a national exam.

It would not be “an objective or efficient way of ensuring advisers achieve requisite competency”, the association says.

“The new model, which is described as similar to the US exams run by the Financial Industry Regulatory Authority, is likely to lower the standards of adviser competency and will be inappropriate for industry, advisers and the regulator alike.”

ASIC’s proposed changes do not address the problem of licensees training advisers to the minimum standard, NIBA says.

“This will not meet ASIC’s stated aim of increasing competency and professionalism in the industry, especially as the examinations system is mainly oriented to new entrants.

“As such, it can only test basic industry, legislative and product knowledge, rather than develop the complex skill base required by the independent adviser.

“NIBA considers the proposed examination system will result in an unnecessary and radical change in the educational system for some advisers.”

However, the Insurance Council of Australia (ICA) backs the regulator’s plan.

“The new three-stage training proposal aims to enhance and maintain the competence of financial advisers, lead to improvements in the quality of advice and increase consumer confidence,” its submission says. “ICA strongly supports these objectives.”    

But the council has called for personal accident and sickness insurance to be changed from a Tier 1 product to Tier 2 – meaning an easier general insurance training schedule.  

“ICA would submit that personal sickness and accident insurance is not more complex than other general insurance products,” it said.

“We also submit personal sickness and accident insurance has no more potential to impact significantly on the client’s financial situation than many other classes of insurance, such as travel.

“[It] also shares the characteristics of other general insurance products referred to by ASIC in its reasoning that these products should be Tier 2.”