The New Zealand government has begun the legislative process for three bills aimed at simplifying compliance obligations across the financial services industry, including insurance.
The move coincides with the full implementation of the Conduct of Financial Institutions (CoFI) regime, which imposes new conduct standards on licensed insurers, banks, and deposit-taking institutions.
On May 20, the Credit Contracts and Consumer Finance Amendment Bill, Financial Markets Conduct Amendment Bill, and Financial Service Providers (Registration and Dispute Resolution) Amendment Bill passed their first readings in Parliament.
Minister of Commerce and Consumer Affairs Scott Simpson said the legislative effort is intended to streamline regulatory requirements without compromising consumer protections.
“Our government is delivering on its promise to make it easier for New Zealanders to access the financial services they need, whether it’s buying a home, growing a business, or simply managing everyday life,” he said.
He said the reforms are designed to enable access to financial products and services by addressing rules that have previously hindered operational efficiency.
“For too long, New Zealanders have been trapped by rules that are overly bureaucratic, unnecessarily repetitive, and sometimes just downright silly. Today, we’ve begun to fix that,” Simpson said.
The proposals include:
They also provide courts with greater discretion over certain lender disclosure cases from 2015 to 2019.
The FMA’s enforcement authority would also expand, allowing more proactive supervision of institutions across the financial services spectrum.
From March 31, financial institutions must operate under the CoFI regime, requiring each to implement a formal fair conduct program.
These programs are intended to support consistent customer treatment throughout all stages of the product lifecycle – from onboarding to claims and complaints management.
According to the FMA, 77 institutions have been licensed under the new framework, including 46 insurers, 17 banks, and 14 non-bank lenders and deposit takers.
Licensed firms must also publish a summary of their conduct programme to provide visibility to customers and other stakeholders.
The CoFI framework originated from a series of regulatory reviews between 2018 and 2020 that identified conduct gaps within the financial services sector.
These findings led to over $215 million in remediation paid out to consumers and contributed to the passing of the Financial Markets (Conduct of Institutions) Amendment Act in 2022.
To support the CoFI rollout, the FMA has also restructured its supervisory framework to prioritise regulatory outcomes rather than process-based compliance.
The new model sets out six focus areas, including product suitability, customer access, consistent service delivery, operational resilience, innovation, and adherence to conduct expectations.
