The New Zealand Government is establishing a taskforce of consumer and financial services representatives to look into the prospect of regulating insurance brokers. Of course, they’re not alone. Although NZ insurance brokers operate without hassles in the present low-level regulatory environment, like many of their global counterparts they have been caught up in the move to regulate stockbrokers, mortgage brokers and financial planners.

The move comes only a few months after the Government announced it was looking at regulating insurance companies.

Commerce Minister Margaret Wilson – whose spokesman warned at the recent Insurance Brokers Association of New Zealand conference that regulatory moves are afoot – repeated the warning in a speech last week to the Christchurch branch of the Financial Planners and Insurance Advisers Association. She says a decision on the reforms is not likely before the middle of next year.

She says the taskforce will examine the shape of the financial services industry and identify problems with the current system.  And it will “work with Australia” to ensure the two countries have similar regulatory objectives.

“There is… a need to consider reforms in Australia, given the commitment of our governments to work towards a single economic market. Compatibility with the Australian regime is important, but we need to see how Australian reforms work in practice and if they are appropriate in the smaller New Zealand market.”

The six-member taskforce is expected to be appointed in a few weeks. It will report to the Government within six months of establishment.