The Insurance Brokers Code Compliance Committee, which assists insurance brokers to deliver high quality service standards to consumers, has recently suggested training should be increased for premium funding. Including ways to assist clients in financial difficulties as a result of the events experienced within the past year.
Regular training provides brokers with up to date information regarding premium funding arrangements, according to an Own Motion Inquiry. Allowing clients to spread out instalments and consolidate their premiums, from numerous policies, into one payment.
More in depth training can also lead to early identification of financial difficulty triggers. Policies and procedures can then be put in place to ensure appropriate response and aqedate assistance.
The inquiry report mentioned “we have seen businesses of all sizes suffer financially due to the pandemic and, in some cases, extreme weather events such as bushfires and flooding”.
With that said it is projected that financial difficulty will be an ongoing issue for Australian businesses and the insurance industry needs to respond. Brokers should establish that clients are entering a third-party arrangement with a premium funder. As well as ensuring the client understands the risks associated if insurance premiums are missed.
The inquiry report states “ensure the client understands their mutual obligations to the premium funder and should financial difficulties arise work together to find solutions so that all parties are appropriately informed”.
The Insurance Broker Code Committee continues to monitor compliance and provides guidance to stakeholders to enhance professionalism and high standards of practice within the insurance broking industry.
Insurance Brokers Code Compliance Committee – https://insurancebrokerscode.com.au/
Insurance News – https://www.insurancenews.com.au/