FMA warns new regime concerns all advisers, and more daily news

The FMA has said that the new regime is intended for all advisers, including advisers are no longer looking for new clients. Director of market engagement, John Botica, has clarified that all advisers will need to be fully licensed. The FMA has warned that they will be following up on adviser to ensure they are all licensed. If advisers aren’t, the FMA will take action. Botica has said the 90 day period is intended for paperwork.

“It is the final working day before the start of the new financial advice regime, and the FMA has warned that it will be following up every registered adviser to make sure everyone is operating under a license.

John Botica, director of market engagement at the FMA, said there had been some confusion in the months preceding the start of the regime, with some advisers believing they do not need a license - however, he said that every adviser will need to be fully licensed, regardless of whether or not they are taking on new clients.

“We will be tracking every authorised and registered adviser to follow their license status through on the FSPR,” he said.

“If you are operating outside of the law, we will take enforcement action.

“Come March 15, you must be operating under the new regime and you must either hold a license, or work for someone who has a license. The 90 days between March and June is simply the opportunity for you to do the paperwork.”” Click here to read more

In other news

Cigna: Life Insurance and Blended Families

FSCL: Title fight: FSCL vs Ombudsman drags on

Quashed: Kiwi insurance start-up attracts backing from Icehouse Ventures

Legal and regulatory review for the life and health insurance sector

28 Sept 2020 – Council of Financial Regulators published an updated table of deferred regulatory initiatives due to COVID-19, originally issued in April 2020.

28 Sept 2020 – The Ombudsman released the results of a survey on access to government information.

The Chief Ombudsman Peter Boshier says too many New Zealanders are still unaware of their rights to request information from Ministers, government agencies, and councils despite a growing thirst for information by the public.

The release of the data coincides with International Access to Information Day 2020 which acknowledges the importance of access to information laws and the community’s right to know.

28 Sept 2020 – The Privacy Commissioner released the submission completed to the Ministry of Justice on n New Zealand accession to the Budapest Convention on Cybercrime.

Daily news update: Newpark at a cross road, and more stories

Bernie McCrea has said that Newpark is looking into introducing shareholders as well as private capital investors to help Newpark achieve long-term goals. Bernie has said that gaining funding from investors is a better alternative than accumulating debt.

“Chairman Bernie McCrea said it was interested in institutional shareholders who might invest in the business to help it achieve its goals. It was also open to investments from private capital investors who might have money in the bank earning little interest.

“People who have an interest in financial services but are earning zero at the moment and want to diversify … we are an option for them.

In other news:

Newpark has given members a choice of four options for their ongoing relationship with the group.

Australia: Former celebrity financial adviser charged with dishonest conduct

Here are five ways to avoid looming 'retirement time-bomb'

Advisers urged to “get their cyber-security sorted”

IFSO: IFSO Scheme names two new commissioners

BNZ to put all staff through courses

Professional IQ: the first glimpse of a problem with the claim

Professional IQ are hosting a workshop titled 'Prima facie claim: the first glimpse of a problem with the claim' on the 8th of August. Details below:

Clients are often surprised when the insurer asks them to prove or quantify their loss. Using case studies of complaints to the IFSO Scheme, this webinar will look at:

  • What is the prima facie claim 
  • What insurers expect clients to prove
  • What clients expectations are
  • What the common issues are
  • How to avoid common issues

Click here to register.

Communicating claim declines

Ombudsman Karen Stevens, has said that the majority of complaints to the IFSO scheme have involved clients being turned down as a result of not being able to demonstrate a claim on first impression, and that clients did not understand the reason for rejection. 

So the client has received a decline letter, and cannot actually explain understand why they have been declined. That has to be a massive communications failure. I am sure I could pause here for a big rant about poor education, distracted people, and self-interested, even - and possible add in a detour into the decline of general reading skills. But none of this matters. The point of writing to a client to explain whether a claim has been accepted should surely include the reason why. At the very least, so that the client doesn't feel driven out of exasperation to make a complaint. 

Stevens also points out that advisers play a critical role in educating clients about the claims process. She continues by saying that advisers can add a substantial amount of value to the overall customer experience.

Click here to read more

It really does pay to get insurance

Uninsured drivers calling the Insurance and Financial Services Ombudsman (IFSO) make up 10% of all contacts. There were lots of people calling about disputes with other drivers, caused, fundamentally, by driving while uninsured. Their disputes included whether or not they were liable, the amount of the costs, and disputing liability for the excess for the other driver, who was insured. The constant stream of inquiries has prompted IFSO to produce a handy leaflet explaining a few basics for these people. Plus Karen Stevens is making this issue pretty clear for people:

“If you own a vehicle, you should have insurance,” says Karen Stevens, Insurance & Financial Services Ombudsman. “We can only investigate complaints from customers about their own insurers. Unfortunately, if you don’t have insurance we can’t do anything to help.”

FSCL Unhappy with "Ombudsman"

Susan Edmunds writes in goodreturns that FSCL is unhappy with elements of the Insurance and Savings Ombudsman's plan to change its name to the Insurance and Financial Services Ombudsman Scheme. Link

What surprises me is the idea that there is significant consumer brand value in any of the names being discussed. These are fundamentally industry brands, known mainly to insiders, referred to by consumers not because they are 'top of mind' but because they found the name and contact details in documentation from their financial services provider. 

When Clients Don't Tell the Truth, Fraud, Misstatement and False Statement in Insurance Claims

Professional IQ are holding a webinar on Wednesday the 20th of May at 9.30am to discuss the consequences of clients not telling the truth to their insurer when they make a claim are serious, but many clients do not appreciate this. The ISO Scheme has investigated a number of complaints where consumers have jeopardised their claim by not telling the truth. Find out how you can help clients avoid these issues.

Using examples from real complaints to the ISO Scheme, this webinar looks at:

  •  What are fraud, misstatement and false statement
  •  What the insurer has to prove
  •  The consequences for clients
  •  How you can help clients avoid issues

Click here to register.