Finanstilsynet's Procedures for Notification of Cancellation or Termination of Insurance for Insurance Intermediaries

Circular
Finanstilsynet's procedures for notification of cancellation or termination of insurance for insurance intermediaries

CIRCULAR:
17/2011
DATE:
04.05.2011
THE CIRCULAR APPLIES TO:
Norwegian insurance companies
Norwegian branches of foreign insurance companies Insurance intermediaries registered with Finanstilsynet

FINANSTILSYNET
P.O. Box 1187 Sentrum
0107 Oslo

Finanstilsynet's procedures for notification of cancellation or termination of insurance for insurance intermediaries 2 | Finanstilsynet

Under the Insurance Intermediaries Act (fml.), insurance brokerage firms and insurance agents must hold insurance to cover any potential liability for compensation. The termination of such insurance or its lapse by other means is not effective against injured parties until one month after Finanstilsynet has received notification of the lapse.

It follows from this provision that it is in the insurance company's interest to notify Finanstilsynet of the termination or lapse of insurance, as the termination or lapse of the insurance will not be effective against injured parties until one month after Finanstilsynet has received notification of the lapse.

Finanstilsynet requests that insurance companies, when notifying of lapse or termination, follow the procedure specified below:

1. The insurance company sends notification of termination/lapse to Finanstilsynet via email: post@finanstilsynet.no
2. The notification must contain the following information:

• Insurance certificate number
• Name of the insurance intermediary
• Organization number
• Type of insurance (liability insurance and/or theft insurance)
• Insurance period

If the above procedure is followed, the time when the one-month period begins to run will be the same day the email is received by Finanstilsynet.

For notifications regarding lapse or termination concerning brokerage firms and agency firms registered in Finanstilsynet's register, Finanstilsynet will contact the relevant firm to inquire whether new insurance has been taken out and to remind them that a new insurance certificate must be submitted to Finanstilsynet.

For notifications regarding lapse or termination concerning agency firms registered in the insurance company's own register, pursuant to Section 7-1 of the Insurance Intermediaries Act (fml.), the company is responsible for ensuring that the agency firms comply with the requirements of the law. Finanstilsynet assumes that as long as the agency firm is listed in the company's register, the company has undertaken to cover the relevant liability for compensation if insurance has not been taken out, or if the insurance has lapsed or ceased, pursuant to Section 7-5, first paragraph, of the Insurance Intermediaries Act (fml.).

Companies with their own agency register must have procedures to ensure that registration obligations are fulfilled at all times and that the agency register is updated. The companies should, among other things, ensure that they receive a copy of the insurance certificate from the agency firm each year if these are to take out insurance themselves, and arrange their processes to receive notifications of termination or cessation of insurance for the agency firms they have listed in their register.

Finanstilsynet's procedures for notification of cancellation or termination of insurance for insurance intermediaries Finanstilsynet | 3

Finanstilsynet will follow up and control during on-site supervision whether the companies have procedures for control and updating of their agency register.

Erik Lind Iversen
Runa K. Sæther

Contact persons:
First Consultant Ingerid Boge, tel. 22 93 99 48, email: ingerid.boge@finanstilsynet.no Senior Advisor Geir David Johannessen, tel. 22 93 97 51, email: geir.david.johannessen@finanstilsynet.no

FINANSTILSYNET
P.O. Box 1187 Sentrum
0107 Oslo
POST@FINANSTILSYNET.NO
WWW.FINANSTILSYNET.NO