Consumers and small businesses will be further protected under a package of legislation introduced into the Parliament today by the Morrison Government.
The package of legislation addresses 20 recommendations and one additional commitment from the Hayne Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
This legislation is another major step forward in completing the implementation of the Hayne Royal Commission.
The reforms being introduced will further strengthen protections for consumers by:
- strengthening the unsolicited selling (anti-hawking) provisions, including for superannuation and insurance products, to prevent pressure selling to consumers;
- introducing a deferred sales model for add-on insurance products, to promote informed purchasing decisions and prevent inappropriate sales of add-on insurance;
- making the handling and settlement of insurance claims a ‘financial service’, which will require insurers to behave honestly, efficiently and fairly and comply with other licensing obligations, to improve claims handling practices;
- prohibiting the trustee of a superannuation fund from having a duty to act in the interests of another person, other than those arising from their duties as trustee of a superannuation fund; and
- allowing provisions in financial services industry codes to be enforceable, with breaches attracting civil penalties, ensuring better adherence by industry and certainty for consumers.
These changes will be complemented by providing further clarity regarding the role of the regulators and enhancing the requirements of financial institutions reporting breaches of the law which will ensure significant misconduct is reported and investigated sooner.
With the introduction of these recommendations, the Government is now focussed on completing the implementation of the remaining recommendations of the Hayne Royal Commission consistent with the updated implementation roadmap issued following the onset of COVID-19.