Explainer: What brokers need to know right now about the Code of Practice Review

Why this review matters to your daily work

The recently released Independent Review of the 2022 Insurance Broker’s Code of Practice makes one thing clear.

Expectations of brokers have shifted. Consumer scrutiny is higher, regulators are watching more closely and long-standing practices are being reassessed against modern standards of transparency, conflicts management and trust.

Conducted by Phil Khoury of consulting firm Cameron. Ralph. Khoury., the Review concluded that the profession faces “significant challenges to its reputation and its self-regulation” and must respond in a substantive way, even if that involves change and cost for brokers.

While Australia's National Insurance Brokers Association (NIBA) agrees change is needed, its response draws important boundaries around how far the Code should go and how those changes should work in practice.

For brokers, the key question is practical. What will this mean for how you engage clients, negotiate with insurers, disclose remuneration and manage conflicts?

The biggest change brokers will feel: transparency

The Review is blunt about transparency. It finds that trust in insurance broking now requires more than assurances.

“To maintain these relationships in a much more testing and skeptical environment will require more transparency and more ‘proof of trust’.”

This plays out most clearly in remuneration disclosure. The Review recommended broader disclosure so clients can clearly understand what brokers are paid and why.

NIBA has accepted this direction in principle and supports extending remuneration disclosure to all individual and small business clients, regardless of policy type.

What this means in practice

• Small business clients should expect the same level of clarity as retail clients.
• Brokers should assume disclosure will become the norm, not the exception.
• Systems and conversations need to support clear explanations, not just compliance documents.

Where NIBA differs is on how and when disclosure should be delivered. NIBA argues that disclosure should occur prior to payment rather than at the point of advice, to avoid confusion and duplication.

The Review is more cautious, suggesting disclosure that comes too late may limit a client’s ability to question or negotiate.

This tension is unresolved. Brokers should expect clearer guidance once the Code is rewritten, but the direction of travel is unmistakable.

More transparency, earlier conversations, and fewer surprises.

Conflicts of interest  

Conflicts management is one of the most criticised areas in the Review. Stakeholders repeatedly told the reviewer that conflicts are not always well understood or consistently managed across the profession.

The Review stresses that disclosure alone is not always enough and that conflicts must be actively identified, managed and in some cases avoided.

NIBA accepts the need for improvement and has committed to consolidating all conflicts obligations into a clear standalone section aligned with ASIC guidance.

What brokers need to take seriously

• Conflicts are not just about commissions.
• Ownership structures, binder arrangements and insurer relationships all matter.
• Saying “we act for the client” is no longer sufficient without evidence.

The Review cautions that some broking practices are not always seen as consistent with a client-first narrative, even when brokers believe they are acting properly. That perception gap is what the revised Code is trying to close.

Negotiation strength must be balanced with sustainability

Although the Review is not prescriptive about negotiation tactics, its message is relevant to daily broking practice. It recognises that brokers are often trusted to negotiate pricing and terms for clients.

However, it also warns against practices that prioritise short-term wins at the expense of long-term client outcomes.

Unsustainable pricing, under-disclosed trade-offs or aggressive tactics that damage insurer relationships ultimately harm clients.

This aligns with NIBA’s emphasis on brokers as trusted advisers who deliver sustainable outcomes, not just cheaper premiums.

In practice, brokers should expect the Code to reinforce:

• good-faith dealings with insurers
• honest representation of risk
• avoidance of tactics that create future volatility for clients

Learn more about ethical negotiation

Record-keeping will matter more than before

One of the less publicised but highly practical changes is record-keeping.

NIBA has agreed to elevate record-keeping from guidance to an explicit obligation under the Code.

This matters because documentation is what demonstrates ethical behaviour when questions arise later.

For brokers, this means clearer records of advice, disclosure and consent documented management of conflicts better evidence if disputes or complaints arise.

This change directly supports the Review’s focus on “proof of trust”.

What NIBA pushed back on

NIBA did not accept all recommendations. Two areas are particularly important for brokers to understand.

First, the Review suggested recasting the Code as “promises to clients” and making it contractually enforceable.

NIBA rejected contractual enforceability, arguing that professional codes are different from product manufacturer codes and that existing legal and AFCA frameworks already govern broker-client relationships.

Second, NIBA resisted highly prescriptive disclosure templates. Its concern is that one-size-fits-all templates could become a compliance exercise rather than meaningful communication, particularly given the diversity of broking models and clients.

Instead, NIBA has committed to a plain-English rewrite of the Code and separate consumer-facing guidance that explains what clients should expect from their broker.

An urgent message

The Review makes a clear warning. If self-regulation does not evolve credibly, external regulation becomes more likely.

“Threats to the continued viability of insurance broking do not come from stronger client protection. The profession’s claimed competitive advantage is a resilient, ethical, trusted relationship with clients.”

For brokers, the message is practical and urgent. The rewritten Code will shape expectations around disclosure, conflicts, negotiation conduct and client communication.

Brokers who embed these principles early will find the transition easier and the conversations with clients more straightforward.

Those who treat the review as a compliance exercise risk falling behind both client expectations and professional standards.

What to focus on now

Before the revised Code is finalised, brokers should already be asking: Are my disclosures clear, timely and understandable? Do I actively identify and manage conflicts, or simply disclose them?

They should also ask themselves: Can I explain my remuneration confidently and calmly? Would my negotiation approach stand up to scrutiny if reviewed later? Are my records strong enough to demonstrate good faith?

The Review and NIBA’s response make one thing certain. The bar for professional conduct has been raised.

How brokers respond in their daily practice will determine whether the Code strengthens trust or simply documents expectations that clients already assume.

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