One of the most complex aspects of FSR is licensing and the system of authorised representatives, especially where insurance is involved. That system has now been simplified by the creation of "insurance distributors"..

ASIC class order 05/1070 deems a distributor of an Australian financial services (AFS) licensee, authorised to deal in general insurance products, as a representative of that licensee when they provide the financial service of dealing in a general insurance product.

This means that distributors (eg third party financial institutions or mortgage brokers) do not need to hold an AFS licence or be formally appointed as an authorised representative to deal in general insurance on behalf of a licensee.

The class order also means that the licensee will be fully responsible for all consumer protection measures under the Corporations Act for the provision of the financial service by the distributor, including providing proper disclosure and dispute resolution mechanisms.

The distributor can only provide the service for either or both of the following:
(i) a general insurance product;
(ii) a bundled consumer credit insurance product.