The Federal Treasurer, Josh Frydenberg, has announced the conclusion of the consultation period for the application of a Deferred Sales Model (DSM) on add-on insurance products.
The DSM will come into effect as of 5 October 2021 for add-on insurance however the regulations provide exemptions for certain classes of add-on insurance products, which are as follows:
- Compulsory third party (CTP) insurance for motor vehicles
- Third party property damage
- Fire and theft insurance for motor vehicles
- Comprehensive insurance for boats, motorcycles, motorhomes, caravans and trucks
- Insurance sold with superannuation (including group life insurance)
- Postage and delivery of consumer goods insurance
- Home building insurance
- Home and contents insurance
- Landlord insurance
- Wholesale style insurances available to businesses
Though not specifically mentioned in the attached release, Dealers should note that comprehensive car insurance is also exempt from the DSM.