Liability Insurance Australia :: News
SHARE

Share this news item!

ASIC Considers Action as Professional Indemnity Insurance Transparency Falls Short

ASIC Considers Action as Professional Indemnity Insurance Transparency Falls Short

ASIC Considers Action as Professional Indemnity Insurance Transparency Falls Short?w=400
The Australian Securities and Investments Commission (ASIC) has voiced apprehension about the transparency of professional indemnity (PI) insurance amongst holders of the Australian Financial Services Licence (AFSLs).
This concern arises from a recent market overview conducted to analyze PI insurance for AFSLs offering personal advice to retail clients.

The market study revealed two primary issues: the lack of transparency in PI coverage and the extended durations required for claims resolution. In response, ASIC is exploring potential measures to address these challenges. Jared Timms, a partner at Howden Broking, emphasized the critical role of brokers in ensuring comprehensive communication with underwriters about the client's services. Timms advised against focusing solely on policy cost, noting that working with local carriers might streamline claims handling.

Since 2020, ASIC has observed a notable decline in the number of AFSLs experiencing PI-related compliance issues, including a decrease in AFSLs seeking waivers for PI requirements. The review also discovered market enhancements such as increased supply, competitive dynamics, premium reductions, and a return to profitability, signifying a recovery since the Hayne Royal Commission-induced exodus in 2019.

Despite these improvements, a Financial Services Council green paper recently critiqued ASIC's oversight on AFSL PI coverage.

The finality of PI claims and the ambiguity surrounding insurance coverage are pivotal issues for the financial services sector. Inadequate PI insurance can leave AFSLs and their clients vulnerable to financial risk, undermining trust in the financial advice industry. For consumers, clear and reliable PI coverage ensures accountability and protection, whereas for AFSLs, it represents a safeguard against claims-related financial duress.

Looking forward, ASIC's initiatives to enhance transparency and oversight, alongside evolving PI insurance market conditions, could herald substantial changes in the regulatory landscape. Expert commentary implies that aligning PI policies with client needs will remain crucial. Concurrently, the introduction of an updated Financial Advisers Register data set, from 15 August 2025, signals a strengthened compliance framework, demanding accuracy in recording adviser qualifications and pathways.

AFSLs are now mandated to update ASIC on any discrepancies within 30 business days to sidestep penalties. ASIC's spot checks have highlighted inaccuracies in the registration of financial advisers, leading to warnings and reprimands. Such compliance measures aim to uphold the regulatory integrity of AFSL operations.

Published:Tuesday, 12th Aug 2025
Source: Paige Estritori

Share this news item:

Insurance News

ASIC Considers Action as Professional Indemnity Insurance Transparency Falls Short ASIC Considers Action as Professional Indemnity Insurance Transparency Falls Short
12 Aug 2025: Paige Estritori

The Australian Securities and Investments Commission (ASIC) has voiced apprehension about the transparency of professional indemnity (PI) insurance amongst holders of the Australian Financial Services Licence (AFSLs). This concern arises from a recent market overview conducted to analyze PI insurance for AFSLs offering personal advice to retail clients. - read more
Traveller Triumphs in Insurance Dispute Over Unexpected Medical Detour Traveller Triumphs in Insurance Dispute Over Unexpected Medical Detour
11 Aug 2025: Paige Estritori

A savvy traveller has successfully challenged an insurance decision after having to make an impromptu stay in London due to a medical emergency. This came after the man needed urgent medical attention following a cat bite he sustained in Albania, which sent him to the UK capital for essential treatment. - read more
Revolutionising Life Insurance: Digital PMARs and Next-Gen Underwriting Revolutionising Life Insurance: Digital PMARs and Next-Gen Underwriting
11 Aug 2025: Paige Estritori

In the age of instant digital services, where everything from basic necessities to luxury items can be delivered in a blink, the life insurance sector in Australia is poised for a transformative change. Historically plagued by lengthy processing times, the sector faces a persistent underinsurance gap, with over a million Australians lacking adequate life protection. The introduction of a digital Personal Medical Attendant Report (PMAR) by Acenda, formerly MLC Life, marks a significant stride towards addressing this challenge. - read more
Victorian Court Approves $34 Million Add-On Insurance Settlement Victorian Court Approves $34 Million Add-On Insurance Settlement
08 Aug 2025: Paige Estritori

A Victorian court has ratified a $34 million settlement in a class action involving add-on insurance products sold by Suncorp. This settlement culminates the legal proceedings surrounding alleged unlawful sales practices. - read more
Study Bolsters Call to Eliminate Insurance Taxes Study Bolsters Call to Eliminate Insurance Taxes
07 Aug 2025: Paige Estritori

Recent research from Victoria University has provided new insights supporting the proposal to abolish insurance taxes in Australia. The study, conducted by Jason Nassios and James Giesecke, examined the effects of varying rates on four primary taxes: personal income tax, goods and services tax (GST), stamp duties, and insurance duties. Unlike previous studies, this research assessed the economic impacts of these taxes as their rates fluctuated, rather than analyzing them at static levels. - read more


Business Insurance Articles

 Why Every Business Needs Public Liability Insurance  Why Every Business Needs Public Liability Insurance
Welcome to our comprehensive guide on public liability insurance. If you run a business, you've probably heard this term thrown around quite often. But what exactly is public liability insurance? - read more
Decoding Public Liability Insurance: Is It a Must-Have for Your Australian Startup? Decoding Public Liability Insurance: Is It a Must-Have for Your Australian Startup?
Public liability insurance is an integral safety net designed to protect businesses from the financial risks associated with lawsuits or claims. It provides coverage when a business is found legally responsible for personal injury to a third party or damage to their property. This form of insurance can significantly reduce the burden of legal fees, compensation claims, and other associated costs that may arise from unforeseen incidents. - read more
5 Tips for Reducing Your Liability Insurance Premiums in Australia 5 Tips for Reducing Your Liability Insurance Premiums in Australia
Liability insurance is a crucial form of protection that offers coverage against claims resulting from injuries and damage to people or property. Within the bustling landscape of Australian businesses, possessing this form of insurance is key to financial security and continuity. It acts as a safety net, ensuring businesses can manage risks without bearing the full brunt of potentially costly legal claims. - read more
Understanding The Costs: How Much Does Public Liability Insurance Typically Cost? Understanding The Costs: How Much Does Public Liability Insurance Typically Cost?
Public liability insurance is a crucial form of protection for both businesses and individuals, safeguarding them against potential claims for personal injury or property damage that occur as a result of their operations or services. In an increasingly litigious society, having this coverage can mean the difference between staying afloat financially and facing business closure due to unexpected claims. - read more
The Importance of Public Liability Insurance in the Australian Labour Hire Industry The Importance of Public Liability Insurance in the Australian Labour Hire Industry
The Australian labour hire industry has seen a significant rise in recent years, and with this growth, comes new and unique risks that companies in this industry must be prepared to navigate. One such risk is the potential for accidents or damages to occur in the workplace, which is where public liability insurance comes in. This article will explore the definition of public liability insurance and why it is so important for labour hire companies in Australia. - read more


Start Here !
Your free liability insurance quote comparison starts here!
Cover Amount:
Postcode:

All quotes are provided free and without obligation. We respect your privacy.

Knowledgebase
Grace Period:
A set amount of time after the premium is due during which a policyholder can make a payment without the insurance coverage lapsing.