Plans for borrowers to receive lenders’ mortgage insurance (LMI) information statements when home loans are approved have been “strongly” backed by the Insurance Council of Australia (ICA).

Such statements are a simple, effective way of helping people understand LMI, and are better than separate statements in loan contracts which can be overlooked, the council says in a submission.

A Federal Treasury discussion paper includes a sample LMI information statement among possible changes to disclosure under the National Consumer Protection Act.

ICA recommends some alterations to the proposed statement’s wording, to improve its clarity and accuracy.