Premium funders appear to have won their battle to keep the most onerous aspects of the Anti-Money Laundering and Counter-Terrorism Financing Act away from general insurance.

It’s understood the Australian Transactions Reports and Analysis Centre (Austrac), the Federal Government body that oversees the Act, has agreed in principle to exempt general insurance premium funders from the regime’s account opening customer identification/verification requirements.

The provisions will still apply when a funder pays out a client on early termination of a contract.

Negotiations with Austrac have been led by Pacific Premium Funding Chairman Grant Burley, who says Austrac will now proceed to draft rules to give effect to the decision.

NIBA CEO Noel Pettersen says brokers will welcome the decision. “This had the potential to be yet another paperwork nightmare with little practical reason, so it’s good to see that reason has prevailed,” he said.

Public consultation on the wording of the draft rule will begin as soon as it is available.
 
The broader legislative requirements to have a program to report possible terrorism or money-laundering matters and to conduct ongoing customer due diligence with regard to risk will continue without change.

For more about this see ANALYSIS.