The National Insurance Brokers Association (NIBA) has had talks with the federal Treasury and the Australian Securities and Investments Commission (ASIC) about an anomaly related to payments into insurance broking accounts.

NIBA has asked for changes to the regulations to bring them into line with industry practice. A copy of the submission will be posted on the NIBA website and members are encouraged to read it.

NIBA CEO Noel Pettersen says the difficulty with Financial Services Reform Act regulations is that brokers cannot pay into their broking accounts any money they receive on their own account – sums due to the broker and not to the insured or the insurer. Examples are the fees charged for advice, placing business and risk management services.

ASIC has responded by granting some relief from the requirement, allowing brokers to put otherwise excluded money into the broking account. Provided certain conditions are met, brokers may deposit in their trust account a single payment that includes acceptable money.

Under the Corporations Act, licensees must notify ASIC in writing of a significant breach of the requirement within five business days of becoming aware of the breach.