The National Insurance Brokers Association (NIBA) will not register its recently released code of practice under the new Australian Securities and Investments Commission (ASIC) regulations.

NIBA CEO Dallas Booth says the association’s code meets its current needs.

“At present we see the [ASIC] codes as giving financial advisers some relief from the draconian powers of the Future of Financial Advice (FOFA) reforms,” he told insuranceNEWS.com.au. “Those powers don’t apply to the general insurance industry.”

Mr Booth says ASIC admits it will take six months to obtain code approval, and NIBA wants the code being used in the marketplace sooner.

He says NIBA will review its code in the next three years, then take a decision on registering the document with ASIC.

Brokers and general insurance providers have been included in the ASIC guidelines, which cover financial services licensees, authorised representatives and issuers of financial products.

ASIC has defined what a code should be and how it will be applied to an industry sector.

“We consider a code to be a comprehensive body of rules that sets enforceable standards across an industry (or part of an industry) and delivers measurable consumer benefits,” its guidelines state.

ASIC wants rules contained in a code to be binding and enforceable for all signatories.

For organisations to register a code, ASIC says it must be “developed and reviewed in a transparent manner that involves consulting with relevant stakeholders”.

The regulator also wants codes to be active documents with “effective administration and compliance mechanisms”.

For approval of codes, ASIC wants to see documents that do more than just repeat the relevant sections of law affecting the financial services industry.

ASIC Commissioner Peter Kell says membership of a code should not be seen as an easy option for compliance, or as a replacement to the opt-in provisions in FOFA.

“Obviating the need for opt-in via subscribing to a code does not mean financial advisers will suddenly have no responsibility or obligations in this area,” Mr Kell said.

“We expect codes will contain provisions that require members to have active obligations towards their clients that will achieve the same outcome as the opt-in requirement intends to achieve.”