Frydenberg heralds life reform

A controversial report into the life insurance industry that recommended capping commissions at $1200 has drawn praise and support from Federal Assistant Treasurer Josh Frydenberg.

The Trowbridge Report has drawn heavy criticism from the financial advice industry, who fear the transition to capped premiums could destroy smaller firms.

However, Frydenberg last week penned an Australian Financial Review column welcoming the report and offering a warning to industry about the cost of continued inaction.

“Wide-ranging and well informed, Trowbridge’s report does not shy away from confronting the difficult issues facing the life insurance industry,” he wrote.

“The report is likely to represent the last chance for the industry to address these longstanding issues on its own terms. While Murray’s financial systems inquiry and the Trowbridge report provide the government with a number of options for reform.

“The extent to which government intervention is required will depend ultimately on the industry’s own actions. It is up to the industry now to restore public confidence before time for industry leadership runs out.”