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AAMC offers you solutions based training and consulting options. Many Banks, Finance Brokers, Financial Planners, Dealer Groups, Accountants, Real Estate Agents and Insurance Brokers entrust AAMC to train their people with courses available for the whole of the financial services industry. Our consulting services are also popular for those wanting advice on how to improve their business and meet the ever changing regulatory environment. Contact AAMC Training Group today to discuss your current and future needs.

Duty of Care, is it really understood?

As an Assessor with AAMC Training Group in the Financial Services sector and mainly dealing with those involved in credit activities, it never ceases to amaze me the lack of interest shown for Risk Cover. Brokers, those new to the industry seeking a Certificate IV (FMB) and those senior experienced brokers seeking to upgrade to a Diploma (FMBM) seem to concentrate solely on the credit details when completing a Fact Find or Client Needs Review. Strange as it seems, it appears they are just interested in doing a loan. There is no legal compulsion for any Broker to sell insurance protection. However, under the Duty of Care and responsible lending guidelines, it is a Broker’s responsibility to advise clients of the ramifications of personal financial hardship caused by accident, illness or death. How many times do we watch current affair shows where the sufferer had no general insurance protection? Failure by the Broker to warn clients of the incumbent risks to do so could mean facing litigation and the courts in Australia may deem the Broker negligent under the Duty of Care. Could get costly! Why place yourself in this position when it is said, Australia is second only to America in the litigious stakes.

Finance/ Mortgage Brokers have three alternatives to become involved.

  1. NO ADVICE – after having explained the financial risks of taking on debt, give the clients the option of :

(a)    signing a referral authority that they would like more information on risk cover  and introduce them to a Professional Insurance Practitioner or,

(b)    An acknowledgement you have suggested they seek further help but they have declined to do so.

  1. GENERAL ADVICE – undertake a course whereby you can become qualified to offer general advice and arrange the cover as stated by the clients that they think they may need to be able to offer certain cover up to the amount of the loan only. However, this certainly does not provide clients with the required levels of cover. They are still exposed to many other events that you are not authorised to discuss or proffer the required advice, given you only have approval from your licence holder to give general advice.
  2. FULL ADVICE – By enrolling in a full advice course, you achieve the appropriate qualifications to give full advice which offers total protection for your clients’ interests and financial needs. These qualifications are the minimum required by most ASIC Licence holders to enable you to operate as an Authorised Representative under their Dealer Licence.

AAMC Training Group offers the courses that can have a two-fold benefit;

  1. The Broker has an additional income stream whether it be by self- marketing the Risk Cover or setting up a Referral Partner
  2. The Broker can feel justifiably satisfied that in the event of an untoward happening, the clients have benefit of compensation to ease the pain during a traumatic experience.

It may not come as a surprise but sometimes we pay more for our car insurance than we do for ourselves.

A colleague once told me, the most rewarding experience he had as a Finance Broker was delivering a cheque to a widow and her kids.

All I am suggesting is that serious consideration be given to undertaking a short course to gain the required qualification to be more than a Finance/Mortgage Broker to your clients.

Author- Barry Doherty

Senior Assessor AAMC Training Group

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