Submissions due today on code changes
The new version tries to tackle the problem of advisers being restrained in offering limited advice to clients who do not need a full financial plan.
Both the Ministry of Business, Innovation and Employment and the Code Committee, which administers advisers’ code, have acknowledged that some advisers have struggled with how to satisfy their requirement to prove the suitability of their advice in the context of the clients’ overall financial situation, when someone only wants guidance on a particular subject.
The committee has proposed replacing the "transactional advice" concept with a wider "limited advice" idea in the code, with relief from the need to assess suitability when advice is requested on a particular product, without a transactional element.
The client needs to initiate the identification of the financial product or products in question or already hold the product. They also must instruct the adviser or the adviser’s employer to provide limited advice.
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