ISWG Consultation: Draft Insurance in Superannuation Code of Practice
The submission to the Insurance in Super Working Group (ISWG) was prepared by the Superannuation Law Committee of the Legal Practice Section.
- As a fundamental threshold point, a superannuation trustee (trustee) cannot agree to be bound to the draft Code because this is inconsistent with its trustee duties and decision-making obligations at law.
- The Code should include a full “compliance with law” clause and expressly permit trustees to act consistently with their duties at law (e.g., to act in members' best interests), even where this is inconsistent with the draft Code.
- The regulatory-like system of governance outlined in the Code is inappropriate for trustees, and trustees should not be subject to the sanction of a code administrator.
- There is a significant lack of clarity about the interaction of the Code with existing law, including the role of APRA.
- As an alternative to a binding Code a more complete solution is that the Code represents best practice and industry guidance. The importance of the Code in setting industry best practice and industry benchmarks should not be overlooked. Industry benchmarks are an important factor in a trustee’s decision-making process.
- For the draft Code to have binding effect on trustees, a legislative solution is required (although this too would require significant amendment to the draft Code.
You can read the full submission below.