Chap 4 Flashcards
A broker must have excellent knowledge of…
The range of products and services available, including the benefits and features of the policy
A benefit is…
A favourable result for the customer arising from a particular advantage
Sales and marketing must sell on..
Benefits not features
Features are…
A characteristic of the service or product such as a standard policy wording.
Brokers must ask questions until….
They establish the underlying needs of their clients requests.
Brokers must explain the insurance…
Product and translate any jargon
Brokers will need to explain….
1) Why they are recommending something
2) How it will deliver or how it will not deliver the benefits the clients want
There is an overarching need for
Transparency and the broker must advise the client on the precise terms of cover
Once the broker has established the clients wants they will need to provide a…
Copy of their clients demands and needs via a suitability statement
A suitability statement will record
1) The clients needs
2) How the recommendation addresses these demands and needs
3) The reasons behind the recommendation
A small company will focus on…
Policy
A large company will focus on…
Utilising risk management/risk financing services
Written agreements with clients include…
1) Regulatory info
2) Broking firms terms of business
3) Details of the service the broker is providing
4) Brokers remuneration
The regulatory information must include…
1) Regulated activities the firm is authorised to take
2) The cooling off period
3) Details of firms complaints
A TOBA is
Market agreements which detail how a broker is to do business with various parties including…
Insurers/clients/producing brokers
A brokers privacy notice must include to comply with the data protection act….
1) What personal information you have
2) What you do with the PI and what you’re planning to do
3) What you need
4) Whether you are collecting the info you need
5) Whether you are creating new personal info
6) Whether there are multiple data controllers
A Brokers SLA describes….
General services as well as specific policy programmes/services the broker is providing.
SLA’s should include…
1) Info on how services will be provided
2) Reporting/communication protocols
3) Description with how claims are dealt with.
Service agreements may define the…
Standard to which the brokers services will be applied. Including;
1) Delivery of renewal terms in a specified time
2) Standards measured by KPI’s
A detailed service plan should…
1) Set out key dates for the year which means both parties are aware of key dates
such as a Client pre renewal strategy meetings
The service agreement may provide a basis for…
The broker to calculate a fee.
A broker can be paid via..
1) Brokerage/commission
2) Client fee
Before the conclusion of the contract a broker must…
1) Agree the basis of remuneration
2) Advise how any fee will be calculated
3) Disclose any interest the broker may have
Where a payment is by fee, the written agreement should detail…
1) The period
2) Whether the fee is in full/adjustable
3) Payment terms
4) The services the fee relates too
5) When the fee is to be earned.
6) Review of timing and process.
7) Whether any services will be provided after the contract is terminated.
Eligable complainants are subject to the FCA complaints handeling rules requiring brokers to…
1) Have a formal procedure for dealing with complaints
2) Inform their clients of this proceudre and their rights to complain to the FOS
3) Manage complaints in accordance with states procedures which the broker should document in the authorised firms compliance manual
Simple/short complaints…
Resolved in three days
Complex complaints…
Require further investigation
Errors and omissions are…
Mistakes by the broker causing financial loss to the client
Errors and omissions can affect the broker by
1) Being expensive
2) Damage reputation.
E+O losses can come to light when
There is an uninsured loss that the insured thought was covered
what might bring about the insured thinking they are covered for a loss?
1) Policy wording does not say what the client thought
2) The policy does not do what the broker said it would
Potential broker mistakes include…
1) Inaccurate explanation of the terms
2) Documentation failure
3) The brokers failure to appreciate the extent of cover
E+O Claims can be reduced by…
1) Ensuring tasks are done right the first time
2) Never being afraid to ask if a problem is beyond your knowledge or competence.
3) Putting convos and instructions in writing
What are the actions when dealing with an E+O claim?
1) Follow set procedures
2) Don’t conceal a problem or try to resolve it
3) Be open and honest
4) Notify professional indemnity insurers promptly.
