Australia is confronting a crisis in accessibility to financial advice, warns Christine Cupitt, CEO of the Council of Australian Life Insurers (CALI). Ms. Cupitt emphasized the urgent need for Australians to have greater options in seeking guidance on their life insurance needs, highlighting the scarcity of financial advisers across the nation, with only 1,000 actively assisting with life insurance products.
Speaking before the Senate Economics Legislation Committee, Ms. Cupitt acknowledged the initial efforts by the government and political stakeholders to address this issue, particularly citing the Delivering Better Financial Outcomes and Other Measures Bill as pivotal in expanding access to financial advice and supporting the essential role of financial advisers nationwide.
Amidst escalating cost-of-living pressures, Ms. Cupitt underscored that many Australians are increasingly uncertain about their financial futures. She cited independent research commissioned by CALI revealing that seven out of ten Australians are anxious about the affordability of life insurance amidst rising living expenses. Access to affordable advice, Ms. Cupitt argued, empowers individuals to make informed decisions crucial for their financial security and well-being.
The CEO further highlighted that despite a significant interest in obtaining financial advice—evidenced by a quarter of Australians considering it in the past three months—only a small fraction (8%) actually received it. She noted that a substantial portion of those seeking advice turn to family and friends due to perceived high costs associated with professional financial advice services.
Looking ahead, CALI is actively collaborating with the Federal Government on forthcoming reforms aimed at facilitating simpler advice provision by life insurers directly to consumers upon request. Ms. Cupitt emphasized that such measures would offer Australians additional choices at no cost, specifically for inquiries related to a single insurer’s products, while maintaining robust consumer protections.
Ms. Cupitt stressed the importance of striking a balance between simplifying access to basic information and adhering to regulatory standards governing personalized financial advice. She expressed optimism that proposed legislative changes would streamline access to financial guidance, reduce bureaucratic barriers for advisers, and enhance customer service standards across the industry.
In conclusion, Ms. Cupitt reiterated that CALI views the forthcoming legislation as a critical initial step in broadening access to financial advice in Australia, ensuring that consumers receive timely and relevant support tailored to their needs while upholding rigorous regulatory safeguards.
