The product disclosure regime has failed to help consumers make better decisions about financial products, according to the National Insurance Brokers Association (NIBA).

It was wrong to assume that giving people information would lead them to make the best decisions, it says in its submission to the financial system inquiry.

“The only realistic way to achieve confident and informed consumers of insurance risk products is to promote financial literacy, followed by the need to seek qualified, professional advice from a licensed adviser who is experienced and expert in risk and insurance matters – in other words, an insurance broker,” NIBA says.

The submission calls for more work on risk management and mitigation to ensure insurance remains affordable, and for reform of insurance taxes and levies.

It says the inquiry should also examine a national and consistent approach to workers’ compensation, builders’ warranty and proportionate liability.

There is no need for stronger regulation of insurance, “especially given the cost to policyholders that higher levels of capital adequacy would incur”.

NIBA says “one-size-fits-all” regulatory policy forces sectors “to be constantly arguing for adjustments, amendments, carve-outs and exemptions”.

It notes brokers were caught up in the Future of Financial Advice reforms, aimed at financial advisers.