Insurance Commission Consent Changes from July 2025: What Advisers Really Need to Know

[* edit 19 June 2025 – we’ve added a couple of extra points at the bottom of this article, following further questions]

As part of the Delivering Better Financial Outcomes (DBFO) reforms, new requirements for obtaining client consent before receiving life insurance commissions will come into effect from 9 July 2025. This has prompted questions across the industry – “Will I need to change my whole advice process?” The answer is: no, not really. 

While the rules do introduce more formal documentation and clearer consent expectations, most advisers are already doing the core of what’s now being legislated – particularly under well-governed licensee frameworks. 

So, what’s really changing? 

From 9 July 2025, you must obtain a client’s informed consent before any insurance commission can be paid. 

The reforms are about: 

• Ensuring clients are clearly informed about commission arrangements 

• Making sure their consent is specific, recorded, and irrevocable 

For many advisers, this is more of a tightening of documentation standards than a process overhaul. 

You’re likely already doing most of this 

If you’re: 

• Disclosing commissions in your SOA 

• Getting signed or digital consent via an ATP or implementation form 

• Keeping that record properly 

…then you’re most of the way there already. 

 What’s required from 9 July 2025? 

Before receiving commission, advisers must: 

1. Make clear disclosures:

• Insurer’s name 

• Commission rate (% of premium) and frequency (e.g., upfront and renewal) 

• Any services provided in relation to the commission 

• A legal statement that commission cannot be paid unless the client consents 

• A statement that the consent, once given, is irrevocable 

These disclosures can appear in the SOA or in a separate form (e.g. ATP). The law does not mandate where they must appear – only that they are provided, consent is obtained, and a record is retained. 

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Two Common Consent Approaches – and What They Require 

1. 1. SOA + Integrated Consent

If you include all commission disclosures in the SOA and seek consent within the same document (e.g., signed acknowledgement at the end): 

• • You likely only need minor adjustments to your current format. 

• • Update your SOA wording to reflect the consent conditions, such as: 

“I understand that the adviser may receive commissions as disclosed in this SOA and that these cannot be paid without my informed consent. I consent to these commissions and acknowledge that this consent is irrevocable.” 

This approach works well where the SOA is comprehensive and signed by the client. 

1. 2. Separate ATP / Consent Form

If your consent is captured outside the SOA (e.g. via an ATP or implementation form), then you must include all prescribed disclosures directly in that form. This includes: 

• • Product and insurer details 

• • Commission rate and payment frequency 

• • Services provided 

• • The required consent and irrevocability statements 

Here is an example of how that wording might look – noting this is illustrative only, not regulated text: 

Client Consent to Insurance Commission 

I understand that my adviser may receive a commission from the insurer if I proceed with the recommended life insurance product(s). 

The commission payable is: 

• • [Insert upfront commission %] of the premium (excluding stamp duty and fees), and 

• • [Insert ongoing commission %] annually for the life of the policy. 

The insurer paying this commission is: [Insert Insurer Name].
These commissions are paid by the insurer and do not increase the premium I pay. 

I understand that this payment is for the services provided by my adviser in recommending and arranging this product. 

I acknowledge that commission cannot be paid unless I give my informed consent.
By signing below, I consent to the payment of these commissions and understand that this consent is irrevocable. 

Note: This is a simple illustrative example only. Advisers should refer to licensee guidance or compliance resources to finalise consent wording.  

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Other Key Points 

Verbal consent is permitted – but with conditions: 

• You must make a record (e.g., audio or written note) 

• Provide the client with a written summary of what they consented to 

You must keep all consent records for 7 years: 

• In written, digital, or audio form 

• Stored securely and linked to the relevant advice file

Practical Adviser Checklist 

Task	What to Do
Review SOA templates	Ensure commission disclosures are clear and consider adding consent acknowledgment language
Update ATP or standalone consent forms	Include product, insurer, commission %, service description, and consent statements
Confirm verbal consent process	Use recorded line or note template; follow up with written summary to client
Check recordkeeping systems	CRM and storage must support timestamped, retrievable consent documentation
Talk to your licensee	Confirm where they want consent captured (in SOA, ATP, or both) and their template wording

 

What Triggers the New Consent Rules?

Both the FAAA guidance (vid plus summary) and ASIC’s Info Sheet 292 are very clear on this point:

The new informed consent obligations apply to personal advice involving insurance products that are first issued or sold on or after 9 July 2025 – regardless of when the advice was provided or the application was submitted.

So if you:

• Provide advice before 9 July,
• But the policy is issued (or sold) on or after 9 July,

Then you must obtain informed consent under the new requirements.

Final Word 

For most advisers, the 2025 reforms don’t require dramatic change – just better documentation and tighter language. 

If your advice process is already built around clarity and compliance, then this is about fine-tuning. 

Compliance Note: 

We’ve made every effort to provide accurate, practical guidance – but you should always check with your licensee or compliance team to make sure your ducks are in a row. 

 

Further References Worth a Look

If you’re after more detail or supporting material, here are a couple of further references:

• Delivering Better Financial Outcomes (DBFO) package
• FAQs: Informed consents for insurance commissions

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Edit: We’ve added the notes below as further questions have arisen since publishing the original article:

A Few Extra Notes (Based on Common Questions)

This article has prompted a lot of interest and practical questions – especially around renewals and changes after advice. Below are a few clarifying points based on current understanding. Please treat these as general commentary only. You should confirm your approach with your licensee, compliance team, or legal adviser.

What about renewal commissions on older (pre-9 July 2025) policies?

• If the policy is grandfathered (pre 9 July) and there’s been no new advice, no change is required – renewals can continue without further consent.

• However, if you’re providing advice after 9 July 2025 – even on a grandfathered policy – you should obtain informed consent, as this triggers a new commission stream (even if reduced). This is the safer and more defensible approach.

What about policies issued after 9 July 2025 – do I need new consent every year?

• No, not necessarily. If the original consent already covered expected renewal commissions (and the commission amount or structure hasn’t changed), then new consent isn’t required each year.

• But if there’s any increase in commission, or a material change to how it’s paid, you will need to get new informed consent before the change takes effect.

If the insurer or client makes a change without advice (e.g., updating cover or switching premium frequency), is consent still needed?

• Usually not. The requirement generally applies when personal advice is provided and commission flows as a result.

• If no advice has been given, and changes are initiated directly by the client or insurer, this typically doesn’t trigger the consent rules – though it’s still worth reviewing your documentation.