Title Life Insurance (Conduct and Disclosure) Bill 1998
Database Bills & Legislation
Long Title a Bill for an Act relating to the conduct of, and the disclosure of information by, life companies, life brokers and life insurance advisers, and for related purposes
Date 30-06-1998
Source House of Reps
Parl No. 38
Bill Number 98118
Bill Type Government
Portfolio Treasurer's portfolio
Reps Bill Code O
Status Not Proceeding
System Id legislation/bills/r578_first/0006


Life Insurance (Conduct and Disclosure) Bill 1998

Part 5—Code of Practice for the Life Insurance Industry

  

44  Effect of Part

                   This Part provides for the establishment of a Code of Practice for the Life Insurance Industry applying to life companies, life brokers and life insurance advisers.

45  Establishment of the Code

             (1)  The regulations may make provision for a Code of Practice for the Life Insurance Industry.

             (2)  The regulations comprising the Code may include provisions for and in relation to the following:

                     (a)  preventing, as far as possible, the issue of life policies that are not appropriate to the needs of the persons to whom they are issued;

                     (b)  ensuring that life companies, life brokers and life insurance advisers maintain at least the standard of service specified or described in the Code when dealing with owners and prospective owners of life policies, and with group members and prospective group members;

                     (c)  ensuring that life insurance advisers are competent in providing life insurance advice;

                     (d)  ensuring that life companies and life brokers have adequate procedures for supervising the competence and conduct of their life insurance advisers;

                     (e)  ensuring that life companies and life brokers have adequate procedures for dealing with inquiries and complaints by owners and prospective owners of life policies, and by group members and prospective group members;

                      (f)  ensuring that, in the case of disputes that are not able to be resolved under procedures referred to in paragraph (e), owners and prospective owners of life policies, and group members and prospective group members, have access to a dispute-handling mechanism approved by ASIC.

             (3)  Without limiting subsection (2), the regulations comprising the Code may include provisions in relation to the following:

                     (a)  the establishment of standards of practice that must be complied with by life companies, life brokers and life insurance advisers when dealing with owners and prospective owners of life policies, and with group members and prospective group members;

                     (b)  the selection and training of life insurance advisers;

                     (c)  the establishment by life companies and life brokers of procedures and mechanisms to handle inquiries and complaints by owners and prospective owners of life policies, and by group members and prospective group members;

                     (d)  the establishment by life companies and life brokers of procedures and mechanisms for the appropriate provision of information by their life insurance advisers in giving life insurance advice to owners and prospective owners of life policies, and to group members and prospective group members.

46  ASIC may give directions

             (1)  If it appears to ASIC that a life company or a life broker has contravened a provision of the Code by an act or omission, ASIC may give the company or broker written notice:

                     (a)  informing the company or broker that ASIC is considering giving the company or broker a direction under this section; and

                     (b)  setting out particulars of the act or omission and the provision of the Code alleged to have been contravened; and

                     (c)  inviting the company or broker to make submissions to ASIC on the question whether a direction under this section should be given; and

                     (d)  specifying the period within which the submissions must be given to ASIC.

             (2)  The period must be a period of at least 14 days beginning on the day on which the notice is given.

             (3)  ASIC may give a written direction to the life company or broker if:

                     (a)  the period specified in the notice has expired; and

                     (b)  after considering the submissions (if any) made by the company or broker, ASIC is satisfied that the company or broker has contravened the provision of the Code by the act or omission specified in the notice.

             (4)  The direction may:

                     (a)  require the company or broker not to do a specified act; or

                     (b)  require the company or broker to do a specified act.

             (5)  The direction takes effect:

                     (a)  on the day specified in the direction; or

                     (b)  if no day is so specified—on the day on which the direction is given to the company or broker.

             (6)  A life company or life broker is guilty of an offence if:

                     (a)  the company or broker does, or fails to do, an act; and

                     (b)  doing, or failing to do, the act results in a contravention of a direction (including a direction as varied) given to the company or broker under this section.

Penalty:  300 penalty units.

Note:          Chapter 2 of the Criminal Code sets out the general principles of criminal responsibility.

47  Revocation or variation of directions

             (1)  If ASIC thinks that a direction given under section 46 is no longer required or should be varied, ASIC must, by written notice given to the relevant life company or life broker, revoke the direction.

             (2)  If a life company or life broker to which a direction has been given asks ASIC, in writing, to revoke or vary the direction, ASIC must:

                     (a)  if ASIC thinks that the direction is no longer necessary or should be varied—revoke or vary the direction; or

                     (b)  in any other case—refuse to revoke or vary the direction.

             (3)  ASIC must give to the life company or life broker written notice of a decision made under subsection (2).