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Fidelity joins FSC exodus

Fidelity Life is the latest insurance company to resign from the Financial Services Council.

Monday, November 23rd 2015, 3:27PM 4 Comments

Fidelity Life chief executive Milton Jennings said his organisation was committed to building an alternative forum to bring about positive change for the industry.

Partners Life, Asteron Life and AIA have already quit over the MJW report into life insurance commissions, released today. Sovereign and AMP earlier tendered their resignations.

Jennings said the company was committed to working to advisers and for the future of the industry but the past week had forced him to take stock of Fidelity's FSC membership.

"Our preference was to stay at the table in order to facilitate discussion that would ultimately benefit advisers and the greater industry. Regrettably, however, this has now become untenable."

Jennings said the company would now focus in working with industry partners to establish a forum that encouraged collaboration and would drive the best outcomes for consumers, advisers and the industry.

"We welcome any review of the industry that brings about a better outcome for consumers and encourages the use of advisers to buy financial products. To support this we are progressing the set-up of an industry forum which will bring together like-minded insurance professionals to work together and ensure positive outcomes for the industry and ultimately protect consumers with a reputable, unbiased, industry-wide advice model."

He said the advice channel was valuable to consumers.

Tags: Fidelity Life financial advisers MJW Report

« Asteron quits FSCMcGuffie set for February trial »

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Comments from our readers

On 23 November 2015 at 4:43 pm Scott Black said:
That must just about be the last nail in the coffin of the FSC - a real shame as it was once a viable organisation where infighting and egos were put aside for the betterment of the industry. Unfortuantely it hasn't been that way for some time.

Milton, if you are serious about working to "establish a forum that encouraged collaboration and would drive the best outcomes for consumers, advisers and the industry" then I would suggest that you actually involve representatives from all of those groups - particularly people who are interested in developing a more sustainable Insurance industry,
On 23 November 2015 at 9:43 pm T said:
I am quite confused with this mass defection of FSC - all those who have given notice are Board Members I presume the Board approved that a report be commissioned agreed to the unacceptably high fee so surely if they were not happy with the result of the report WHICH THEY SHOULD NOT BE the first port of call would be to call MJW in for a please explain yourselves session - they should also have asked for it to have been redone no further cost and not to be issued, especially as it seems to be a rewrite of the Trowbridge report - why would mass defection benefit the Adviser force or industry. Also interesting that it appears the banks are not defecting assume this whole defection plays into their hands the cause of the problem.

The report is terrible, one sided and not on the side of all the rotten advisers - has anyone asked the Insurance providers how much the premiums would reduce if commissions were reduced as suggested. Has anyone asked a client or two whether they mind that we get paid for seeing them in the evenings, don't own the commission for the first two years if they cancel or get churned by another adviser who thinks they know what happened at our appointment, pay for staff that assist them over the phone - these sort of non issues are making our Industry look incompetent!
On 23 November 2015 at 10:18 pm gavin austin adviser business compliance said:
A shame but inevitable. All stakeholders need to look at calling for a where to from here. Input from FMA, product suppliers, adviser bodies, distributors, Chanel Groups, compliance consultants, industry consultants needs to happen and soon.

The FAA review people may then be more likely to sit up and take notice. Clearly there are issues that need to be addressed. The MWJ report should be at the least given some credit for making the industry get some unified outcomes for the most important stakeholder the consumer. Happy to assist to get the ball rolling if others feel there is any merit in getting a meeting organised.
On 23 November 2015 at 10:52 pm Donald said:
I guess one of the providers had to be last cab off the rank to signal their dissatisfaction to the FSC. What has happened in the past two weeks for Milton to leave it so long? perhaps he was being a gentlemen and letting the ladies go first.

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