Informed Consent For Insurance

From the 9th July 2025, Australian financial services (AFS) licensees and authorised representatives that receive monetary benefits (e.g. commissions) as part of the issue or sale of life insurance to a retail client in personal advice situations must obtain informed consent from the relevant client to the benefit being given to avoid the benefit being classified as conflicted remuneration.

What are your obligations?

As a representative of IIP that receives monetary benefits (e.g. commissions) in connection with issuing or selling life insurance to a client while providing, or being likely to provide, personal advice to that client, you must:

• obtain the client’s informed consent to receive the benefit before the insurance is issued or sold

• have the client’s written consent (or a copy of it), or a written record of any verbal consent that the client gave, and

• as soon as practicable after the client provided informed consent, give the client a copy of the written consent, or a copy of the written record of the client’s verbal consent: see section 963BB(1).

When does this requirement apply?

The informed consent requirement applies to monetary benefits – commissions specifically - given in connection with the issue or sale of life insurance policies, as well as a range of general insurance policies, where personal advice was provided for policies issued from 10 July 2025 onwards.

The consent requirements do not apply to policies issued prior to 9 July 2025, and those that are renewed under the same terms (same level of ongoing commission as originally disclosed) and same level of cover.

A new consent is required in the following situations for existing life insurance policies:

• If the level of cover is increased

• The commission rate (%) is increased and/or the frequency of the commission payment is

increased

• If an adviser is taking over an existing insurance policy from another adviser – this consent is

required under Standard 7 of the Code of Ethics

• If there is a rewrite of a policy, for example if a trauma claim is paid out and the policy is

reissued as life only.

If the commission level is decreased for a policy being renewed, the consent remains valid.

When do the insurance obligations NOT apply?

Circumstances where the informed consent requirement does not apply for life insurance products:

• Issues or sales before 9 July 2025: The informed consent requirement does not apply to monetary benefits given in connection with insurance issued or sold before 9 July 2025: see section 1708E(1).

• Non-monetary benefits: Non-monetary benefits whose value is less than $300, or similar benefits are not given on a frequent or regular basis, and; benefits for education and training purposes or information technology software or support

• Renewals of life risk insurance: The informed consent requirement does not apply to monetary benefits given in connection with renewals of life risk insurance, if

  • the representative disclosed to the client before the client agreed to be issued or sold the insurance the expected renewal period(s) as part of the period over which monetary benefits covered by the consent could be given, and

  • the rate or frequency of monetary benefit upon renewal is less than the rate or frequency of monetary benefit disclosed to the client before the original consent

What information needs to be disclosed to the client for informed consent?

Before a client can provide informed consent, you must disclose the following information to them:

• the name of the insurer under the relevant product if known

• the rate of the monetary benefit that you will receive:

  • expressed as a percentage range of the policy cost for general insurance (e.g. 10–20% of the premium), or

  • expressed as a percentage of the policy cost payable for life risk insurance and consumer credit insurance

• the frequency with which you will receive the monetary benefit, and the period over which the benefits covered by the consent could be given (if more than one monetary benefit will be given in connection with the issue or sale)

• the nature of the services that you will provide to the client in relation to the relevant product (if any)

• a statement that it is a requirement of the law that the client’s consent must be obtained before the payment of an insurance commission, and

• a statement that the client’s consent, once provided, is irrevocable: see section 963BB(1)(c).

Click the button below to learn more on the ASIC Information Sheet 292 (INFO 292)

What Changes Are Being Made?

The Disclosure Page:

The Disclsoure Page in the SOA now includes:

• the insurance commission table.

  • the name of the insurer under the relevant product if known.

  • the rate of the monetary benefit that you will receive.

  • expressed as a percentage of the policy cost payable.

• the frequency with which you will receive the monetary benefit, and the period over which the benefits covered by the consent could be given (i.e. Annualised)

• a statement that it is a requirement of the law that the client’s consent must be obtained before the payment of an insurance commission, and

• a statement that the client’s consent, once provided, is irrevocable: see section 963BB(1)(c).

• Reference to the signing and dating the Authority to Proceed to consent to the fees being received.

The Authority To Proceed (ATP):

The Authority To Proceed includes a separate tick box that the client consents to the representative receiving the monetary benefits outlined in the insurance disclosure section.

The client can tick and sign the ATP as informed consent.

Accessing Updated SOA Templates

Xplan Users:

If you use our IIP Xplan site, the SOA wizard will be automatically updated on the 9th July 2025.

Click the button below to learn more about the changes to the iComply2 SOA template in Xplan.

Other CRM’s:

If you use other CRM’s, you can update your SOA template by accessing the licensee ‘Informed Insurance Consent’ templates from the Templates Register in the iC2 Compliance Hub.

You can access the Templates Register from the iC2 Compliance Hub,

Search the Register for ‘Informed Insurance Consent Templates’. Click on the policy document to download the template.