LIF Rules and your AIA Australia experience from 1 January 2018

The maximum allowable commission will be adjusted in line with the LIF rules.  Commission is payable on the total annual premium excluding any policy fees, premium frequency charges, Government stamp duty and the AIA Vitality Contribution Fee (if applicable). 

The AIA Vitality Activation Payment is not impacted by the LIF remuneration rules. AIA Australia will continue to pay $250 when AIA Vitality is added to a Priority Protection policy (subject to approval from your licensee). 

Below is an outline of AIA Australia’s approach to grandfathering under the LIF rules.

Policies issued prior to 1 January 2018:

Policies issued prior to 1 January 2018 will be grandfathered for LIF purposes.

Policies issued after 1 January 2018:

Policies issued after 1 January 2018 will be grandfathered for LIF purposes if:

• Electronic applications are submitted to AIA Australia before 1 January 2018;
• Paper applications are signed and dated before 1 January 2018 AND received by AIA Australia before 1 February 2018;

AND

• Electronic or paper applications are issued by 31 March 2018

All commission paid on grandfathered policies (including commission paid on alterations or additions) will:

• not be impacted by LIF; and
• be subject to our existing 12 month clawback rules

There will be a two year clawback period for all policies not grandfathered. This clawback period applies to any commission paid on the original sum insured and any additions made in the first two years. 

Any commission paid on additions to a policy after the two year clawback period has ended will be subject to our existing 12 month clawback rules.

Upfront commission clawbacks