On Friday 11 December, ASIC released the final guidance (RG 274) on the Design and Distribution Obligations (DDO). Since the release of the consultation paper and draft regulatory guide late last year, the industry has been eagerly awaiting the finalised guidance to support its ongoing DDO implementation in readiness for 5 October 2021.
RG 274 sets out ASIC’s expectations on how the regime will operate, its expectation for compliance and its approach to administering DDO.
The RG takes into consideration the consultation and feedback received from the industry. Largely, the guidance on DDO has not significantly changed.
Below we have set out the key considerations for insurers.
Insurers should review their approach to DDO in light of the finalised guidance and apply the insurance specific examples ASIC has provided for the various DDO requirements as part of ongoing implementation and uplift to product governance arrangements.
Whilst ASIC’s guidance has not materially changed, insurers will still need to take deliberate actions in achieving good customer outcomes and implementing the extensive DDO requirements, for both issuers and distributors. All in all, a substantial amount of work still needs to be undertaken in readiness for October 2021.