The redrafted broking code of practice is “undoubtedly easier to read, but not necessarily stronger where it matters most”, financial counsellors say.

The document is clearer and strengthens professional aspirations, but it often lacks enforceable consumer protections, according to a submission from counselling organisations in Victoria, Queensland, SA, the ACT and WA.

Counsellors say the code is more accessible and stronger in some important areas, and they particularly welcome improved vulnerability provisions, but many reforms they recommended remain absent from the draft.

These proposals included standardised disclosure templates to allow comparison of remuneration and conflicts of interest, documentation explaining why a product was recommended and alternatives considered, and clear due diligence obligations requiring brokers to “properly understand a client’s circumstances” before providing advice.

The submission says that on time frames, the draft largely continues to rely on concepts such as “timely manner” and “as soon as reasonably practicable” for claims lodgement, responses and proactive updates.

“The credibility of this code will ultimately be judged by whether it prevents the types of consumer harm that financial counsellors continue to encounter in practice.

“The draft asks consumers to trust that brokers will do the right thing. A modern code should require them to demonstrate it and enforce action where they don’t.”

Submissions closed last week on the draft document, which was released by the National Insurance Brokers Association on July 8.