The National Insurance Brokers Association (NIBA) believes the Australian Securities and Investments Commission’s (ASIC) proposals for financial adviser exams should not apply to brokers.

In its submission to ASIC’s CP153 consultative paper, NIBA says it believes ASIC can “support industry efforts to boost participation in educational programs by working with industry sectors to improve the current training system”.

But it adds: “It must be careful not to disrupt the considerable work that has taken place since the Financial Services Reform Act transition to implement comprehensive education systems for advisers.

“The licensing arrangements for insurance brokers are working well and there is no client-driven demand for change.” 

NIBA says the issues raised in the CP153 proposals “primarily apply to the financial planning and investment sector”.

The Financial Planning Association (FPA) has urged ASIC to avoid changing the current education system for advisers without looking at how the new proposals will sit with the existing RG146 framework.

“CP153 does not speak to a strategic approach in improving education and training of advisers,” the FPA said in its submission to ASIC.

“It offers ad hoc tactical options that do not seem to consider how the proposals align with the Australian Government’s current national education framework or give consideration to how the proposals will impact the requirements of ASIC’s own current regulatory expectations.”

The FPA says it cannot see what ASIC wants to achieve with the exams proposed in CP153.

“CP153 states the proposals are intended to be in addition to RG146 without any detailed consideration as to how RG146 has been applied within the national education system,” it said.

“The danger of such a limited approach to understanding the relationship between the proposed exams, RG146 and the wider education system is likely to create duplication in many of the existing education and training offerings, at significant cost to industry and government, but with minimal benefit to consumers, government or industry.”

However, the Financial Services Council has supported a national examination system run by ASIC “to ensure a standard minimum education/competence level”.

“But there needs to be a clear distinction between those roles where advising is the key activity of the role (such as financial advisers) and those where providing personal advice to retail clients is not the core activity in their role (such as client service managers).

“We suggest that where advising is not the key activity of the role, then only the core module and any relevant specialist modules of the exam would need to be completed.”

The Australian and New Zealand Institute for Insurance and Finance (ANZIIF) wants the diploma level qualification to be the minimum level for all personnel offering advice in general insurance, insurance broking and life insurance. It recommends the advanced diploma as the minimum level for financial planning.

But ANZIIF has opposed national adviser exams in the format recommended by ASIC. It says the proposed system “must adequately cover many different products across the knowledge and occupation bands”.

“This will be a difficult thing to do in one exam and our fear is that it will by necessity attempt to be so all-encompassing that any substantive testing or assessment of knowledge and skill will be necessarily homogenised and attend to the lowest common denominator.”