Media release: Small businesses benefit as AFIA announces new Insurance Premium Funding Code

by AFIA

17 August 2022

Small businesses benefit as AFIA announces new Insurance Premium Funding Code

• Business customers, especially small businesses, will benefit from increased transparency and disclosure on pricing
• Compliance with the Code will be governed by an experienced and independent Compliance Committee
• New Code an example of the finance industry voluntarily adopting industry standards that go above and beyond what is required by law.

Business customers seeking insurance premium funding will benefit from industry best practice through a new Code of Practice.

The Australian Finance Industry Association (AFIA) and its Insurance Premium Funding (IPF) Working Group members have launched their Code of Practice after extensive consultation with key stakeholders. The Code will come into effect on 1 October 2022.

AFIA members Arteva, Attvest, BOQ Finance, Clearmatch, Elantis, Hunter Premium Funding and IQumulate were involved in development of the Code.

Insurance is fundamental for any businesses, and insurance premium funding products provide business owners with the flexibility to access the right insurance protection for their business in a way that helps them manage their cashflows. Risk management and cashflow management are particularly important during times of economic volatility.

AFIA CEO, Diane Tate said: ‘This is an important milestone. The Financial Services Royal Commission made it clear it’s not just what financial institutions do that is important, but how they do it, and firms are now required to embed a consumer-centric approach.”

“The new IPF Code of Practice is an example of the finance industry proactively adopting industry standards that go above and beyond what is required by the law. The Code has gone through an extensive consultation process to ensure insights from a broad spectrum of stakeholders are included.”

The customer-centric Code supports customers by:

• Enabling them to easily compare the features and costs of different IPF product pricing using several standardised metrics
• Ensuring high standards of practice in the design and distribution of IPF products
• Supporting access to insurance and finance through a competitive and innovative market.

The Code’s commitments require signatories to deliver clear disclosures to enable better comparison of the features and costs, provide customers with access to internal and external dispute resolution including through AFCA, provide hardship assistance, and ensure arrangements require brokers to act in the best interests of customers in the distribution of IPF products. The Code also promotes continuous improvement of customer service and a culture of professionalism in the IPF industry.

AFIA believes an independent Compliance Committee is fundamental to the credibility and effectiveness of a code of practice. The Compliance Committee is responsible for overseeing and administering the code, including monitoring and investigating providers’ compliance and imposing sanctions for non-compliance.

AFIA has appointed Ms Vicki Mullen to chair the IPF Code Compliance Committee.

As Chair of the IPF Code Compliance Committee, Ms Mullen’s role will be critical to ensuring the Code is administered in a fair, reasonable, independent and effective way.

As well as industry, board and government experience, Ms Mullen was most recently an Ombudsman with the Australian Financial Complaints Authority and her expertise includes dispute resolution, industry self-regulation and codes. On her appointment Ms Mullen said ‘The Code is an important tool that protects businesses – especially small businesses - while supporting competition and innovation. The Code Compliance Committee is an important part of successful self-regulation and I am very pleased to be involved in this work with the Insurance Premium Funding industry.”

Ms Mullen is joined on the Compliance Committee by legal practitioner Mr Ed Martin and Mr Dallas Booth, both of whom have extensive experience in the Australian insurance industry.
Download a digital version of the Code here.

For further information, contact:

Anna Fitzgerald
+61 410 447 922
anna.fitzgerald@afia.asn.au

About AFIA

AFIA is the only peak body representing the entire finance industry in Australia.

We represent over 150 members, including bank and non-bank lenders, neobanks, finance companies, fintechs, providers of vehicle and equipment finance, car rental and fleet providers, and service providers in the finance industry. We are the voice for advancing a world-class finance industry and our members are at the forefront of innovation in consumer and business finance in Australia. Our members finance Australia’s future.

We collaborate with our members, governments, regulators and customer representatives to promote competition and innovation, deliver better customer outcomes and create a resilient, inclusive and sustainable future. We provide new policy, data and insights to support our advocacy in building a more prosperous Australia.

About the IPF Code Compliance Committee

Vicki Mullen
Ms Mullen has over 25 years’ experience in public policy and financial services, having worked in senior strategic roles with the Insurance Council of Australia, the Actuaries Institute, IAG and Swiss Re. Most recently, Ms Mullen was an Ombudsman with the Australian Financial Complaints Authority. She has worked extensively within government and her expertise includes dispute resolution, regulatory affairs, industry self-regulation and codes, professional standards and government and stakeholder relations. She is a published commentator on parliamentary privilege and has held several roles as a not-for-profit director. Vicki holds a Master of Laws from the University of NSW and is a Graduate of the AICD.

Dallas Booth
Mr Booth has extensive experience in the insurance industry and was the CEO of the National Insurance Brokers Association (NIBA) for 10 years until he stepped down from the role in October 2021. At NIBA he represented theinterests of insurance brokers to governments, regulators, the media and the community. Prior to joining NIBA, Dallas was CEO of the compensation fund agreed between James Hardie and the NSW Government to fund asbestos compensation claims. He was previously the Deputy CEO of the Insurance Council of Australia and before that held a number of roles in the NSW Government. Dallas is a Fellow of the AICD and holds a Diploma of Law.

Edward Martin
Mr Martin is a partner at Gadens, specialising in major, complex disputes and investigations and has extensive experience acting for corporates ranging from multinational and ASX listed companies to not-for-profits, including Industry bodies, and for government entities. Mr Martin advises on commercial disputes, contentious regulatory cases, investigations and commissions of inquiry - particularly relating to banking and financial services. He regularly acts in Federal and State Court litigation involving contracts, allegations of misleading or deceptive conduct, corporations and competition law and administrative law issues. Mr Martin also has particular expertise in the effective use of alternative dispute resolution, particularly arbitration and mediation.