Modernisation of premium collection by insurance intermediaries

20/01/2015

The AFS states that an intermediary has a right to collect premium for the insurer. The set-off of the collected premium takes place through receivables from the intermediary on a current account. This results into a financial relationship between the intermediary and the insurer. Because of this financial relationship, the un-desirable situation of directing the customer to buy products for the incorrect reasons (i.e. the offerors interests rather than the customers interests) could develop.

Therefore from the entry into force of the amendments to the AFS effective 1 January 2015, intermediaries are no longer permitted to collect premium relating to complex products. However, after the amendments to the AFS will enter into force it will still be possible for the intermediary to conclude an agreement with the insurer in order to collect premium for complex products. Therefore it is to be questioned whether the amendment of the AFS will have the desired effect.