The DDA has introduced a new rule of proportionality: a company`s organizational management measures to manage conflicts of interest must be proportionate to the activities, policies sold and the type of insurance distributor it is located. The DD ID also introduced a rule requiring a broker to ensure that its governing body receives regular and at least once-a-year written reports on registered conflicts of interest. The advertising rules for the sale of pure protective products – critical illness, income protection and non-investment life insurance – under ICOBS were changed at the end of 2012 following the FSA`s Retail Distribution Review (RDR). The DDI does not affect these rules. In general, the wholesaler does most of the work to ensure that insurers receive the appropriate information. And wholesalers have the right to collect wholesale brokerage fees for their insurance efforts as well as access to insurance markets that can withstand the risk. Consumer complaints to insurance regulators about non-payment of fees are serious and costly transactions. They also affect the manufacturer`s brand and reputation. In addition to buyer complaints, these complaints can also be filed or encouraged by competitors. These complaints may tarnish a retailer`s reputation in the marketplace, which will most certainly allow the retailer to require the services of external consultants. It`s not funny. At American Agents Alliance, we help your independent insurance agency stay abreast of form development. We offer a resource bank with the best form templates to make your life a little easier as an insurance agent.
Contact us today to learn more about our services and networking opportunities. According to the rules of the DDI, the broker must inform the insured in a timely manner before the initial insurance contract is concluded and, if necessary, of its modification or extension (ICOBS 4.3.-7R) on the nature and basis of the remuneration – that is, the payment of a fee. Until the DTIS, disclosure of compensation to consumers was not regulated. The new rules require the broker to inform the client in a timely manner prior to the conclusion of the original insurance contract and, if applicable, its modification or extension, the nature and basis of the remuneration he received in connection with the insurance contract and, if applicable, its modification or extension (ICOBS 4.3.7R). During the consultation on the rules, the FCA explained that it considered “nature” in the fact that companies had to disclose the type of remuneration. B for example, the basic commission, bonus, incentive or other financial incentives – while the “base” requires companies to disclose the source of the remuneration. The guidelines of ICOBS 4.3.-4G are therefore that disclosure includes the nature of the compensation and its source. As a well-known imniste in the insurance industry, what do you expect from brokerage fees and other fee information if you were the purchaser of the insurance? Do to others what you want them to do for you and you are probably free at home. Similarly, insurance brokers are generating more and more revenue by entering into service agreements with insurers that co-exist with intermediation contracts. Under these service agreements, a broker may provide the insurer with services such as data provision, data analysis, industry advisory reports, insurers` feedback services, and pipeline discussions.