The revised Insurance Brokers Code of Practice (the Code) started on 1 January 2014. All insurance brokers who subscribe to the Code need to comply by 1 July 2014.
The revised Code’s key objectives include to:
- ensure there is a focus on the interests of the client
- promote informed and effective relationships between insurance brokers and their clients
- promote efficiency in insurance transactions
- describe standards of good industry practice and client service, and
- promote the effective resolution of disputes between brokers and their clients.
The Financial Ombudsmen Service (FOS) suggest you review your procedures against the 12 service standards outlined in the revised Code prior to 1 July 2014. Here are some questions to ask as part of that review:
Do we have processes and procedures to ensure that our staff:
- comply with the law?
- behave diligently, competently, fairly and with honesty and integrity?
- advise our clients about who we act for?
- advise clients about the scope of our services?
- clearly explain how our covered services are paid for?
- act with competence and are adequately trained?
- handle money appropriately?
- adequately disclose remuneration?
- respond to catastrophes and disasters in a timely, practical and compassionate way?
- handle complaints from our clients according to our dispute handling processes?
- promote our subscription to the code and its obligations?
- not engage in any conduct that would bring the profession into disrepute?
FOS are happy to assist you with your Code Compliance operations in the lead up to July 2014. Please call Daniela Kirchlinde on 03 9613 7368 if you wish to discuss any aspect of your transition plan.
Own motion inquiry: ‘Code training’
In order to assist with transition FOS will be examining the training being conducted for staff of insurance brokers on the revised Code’s obligations.
The inquiry will include an examination of whether Code requirements under standard 8 of the Code have been incorporated into day-to-day procedures and processes as staff must be able to apply their training in their dealings with clients.
The objectives of the inquiry are to:
- develop a better understanding of how Code subscribers manage their Code obligations to ensure adequate Code training for relevant staff.
- benchmark the level of compliance across insurance brokers in relation to their obligations under standard 8.
- create a picture of current Code related training processes and any areas for improvement.
- understand whether key controls are in place to ensure staff are up to date with their training related compliance obligations.
- assess how often these key controls are monitored.
- ensure a greater understanding of training compliance completion records across each insurance broker.
- verify that current breach recording practices in relation to training are accurate and effective.
A sample number of Code subscribers will receive a short survey in May 2014 for completion and return to us.
A report on the inquiry will be published upon completion.
The inquiry should benefit insurance brokers and assist in their ability to effectively transition to the revised Code’s obligations.