The National Insurance Brokers Association (NIBA) says a meeting with Treasury last week has opened the way for developing an approach to new product design and distribution rules that will work for the insurance sector.

CEO Dallas Booth says he and legal adviser Mark Radford met with Treasury officials to discuss the issue and a possible way forward, and had received positive feedback.

“There is a little bit of work and co-ordination to be done and then we will be able to talk a bit more about it,” he told insuranceNEWS.com.au.

NIBA and the Insurance Council of Australia (ICA) have previously raised concerns about the new rules, which require product issuers to identify target markets.

Issues include how they apply in the case of retail home and motor policies and potential conflicts for brokers.

“Our next step will be to discuss the matter with the Insurance Council to see if we can develop a jointly agreed approach,” Mr Booth said.

Further talks will be required with the Australian Securities and Investments Commission (ASIC), which will oversee the new laws.

ASIC will release a consultation paper toward the end of the year on its regulatory approach to the laws, which were passed by Federal Parliament earlier this year along with product intervention powers.

The ASIC intervention powers range from ordering changes to the way a product is sold to an outright ban when it considers there is a risk of consumer harm.

ICA says in a submission released last week that the regulator should carry out confidential checks with firms before it publicly announces planned interventions, in order to clarify possible misunderstandings or factual errors and to prevent unfair reputation damage.

An ASIC consultation paper suggests that simply publishing a proposed order on its website and inviting comment would meet its consultation obligations. It would also consult the Australian Prudential Regulation Authority (APRA).

ICA says that besides this level of consultation, “there should also be meaningful confidential engagement with affected firms ahead of any public release of the proposed product intervention order or its contents”.