Terms of Business

Please read this document carefully.  It sets out the terms and conditions on which we agree to act for our direct commercial customers and contains details of our respective responsibilities.  Please contact us immediately if there is anything in these terms of business which you do not understand or with which you disagree.  We are particularly draw your attention to the section headed “Handling of monies”.

About us

We, Lonmar Global Risks Limited, of Matrix House, 9 Aldgate High Street, London EC3N are an independent insurance intermediary and we are authorised and regulated by the Financial Services Authority (FSA).  We are ultimately controlled by Axa UK Plc through our parent, AXA Advisory Holdings Limited.

Any references to “you” are to any person indentified as an insured in any policy we place.

You can check our name and address, and that we are included on the FSA’s Register, by visiting the FSA’s website www.fsa.gov.uk/register or by contacting the FSA on 0845 606 1234.

Our Services

As an intermediary, we owe duties to you and, unless you instruct us otherwise, our services include:

• advising you on your insurances and providing other risk management services (which may not be regulated by the FSA) as agreed with you

• placing insurance on your behalf with insurers, as instructed by you

• making amendments, at your request, to insurance policies we have placed on your behalf

• handling with insurers claims made on insurance policies we have placed on your behalf (unless arrangements for direct notification to insurers have been agreed between us) for so long as we are appointed to renew your insurances and, subject to the payment of a separately agreed fee, after we have ceased to be so appointed

• collecting premiums from you and paying them on to insurers and collecting claims from insurers and paying them on to you (unless arrangements for direct payment have been agreed between us)

• retaining documents relating to the placement of your insurances and of claims made for an appropriate period but in accordance with regulatory requirements as a minimum (following which the documents will be destroyed).

As we are an intermediary, we cannot and do not guarantee that the insurers with which we place your insurances will meet your claims.  A liability for premium, whether in full or pro rata, may arise despite an insurer becoming insolvent.

We shall assume, unless you advise us to the contrary, that you authorise us to agree with insurers the terms and conditions of your insurance contracts consistent with your instructions to us.  You should not rely on any insurance contract you have instructed us to place until we have confirmed to you in writing that the insurance contract is in force.

Handling of monies

When we receive premiums from you or claims or premium refunds from an insurer for payment to you, those monies will be held by us on one of two bases, depending on our arrangements with the insurer concerned.  We will either hold those monies as your agent, in which case it will be treated as client money in accordance with the FSA’s rules, or we will hold it as agent of the insurer.  In either case, monies will be subject to the terms of a non-statutory trust. Since monies held on either basis are protected in the trust, we will not normally inform you of the basis that applies.

Where we receive monies as agent of the insurer, you will be treated as having fulfilled your obligation to pay premium to the insurer when you have paid the premium to us.  The insurer will not have fulfilled its obligation to pay claims or premium refunds until we pay those claims or premium refunds to you.  Equally, once we have received a premium from you, we will be unable to refund that premium to you without the insurer’s consent.

Under the FSA’s client money rules we are required to keep client money separate from our own money.  We normally do this by paying money into a client bank account designated as a non-statutory trust, which will also be used for handling premiums and claims relating to other customers’ insurances.  However, we may also do this by arranging to hold separately permitted designated investments with a value at least equivalent to the money that would otherwise have been paid into a client bank account.  If we do this, we will be responsible for meeting any shortfall in our client money resource which is attributable to falls in the market value of a segregated investment.  In either case, money held by us, as agent of our customers, under the non-statutory trust is co-mingled with money held by us as agent of insurers although insurers’ interests in monies held by us as their agent is subordinated to the interests of our customers.

The terms of the non-statutory trust allow premiums due from a customer to be paid to insurers out of the bank account in which we hold client money and insurer money before they have been received from the customer.  In addition, claims and refunds of premiums may be paid to a customer before the claim or premium refund has been received from insurers.  This is known as funding.  We are not, however, entitled to use client money to pay commissions before we received the relevant premium from the customer.

Unless you give instructions to the contrary, we will treat the payment of premiums by you to us as signifying your consent to the payment of those premiums, and of any claims and refunds of premium which fall due to you, into a non statutory trust.

Any interest earned on client money held by us and any investment returns on any segregated designated investments will be retained by us rather than paid to you.

We may transfer client money to another person, such as another broker or settlement agent, for the purpose of effecting a transaction on your behalf through that person.  Where client money is transferred to a broker in the UK, that broker will also be regulated by the FSA and will therefore be required by the FSA’s rules to handle your monies on one or other of the bases described in this section.

Where the broker or settlement agent is outside the UK, the legal and regulatory regime applying may be different from that of the UK and, in the event of a failure of the broker or settlement agent, money may be treated in a different manner from that which would apply if the money were held by a broker or settlement agent in the UK.  You may notify us if you do not wish your money to be passed to a person in a particular jurisdiction.

Our liability to you

Unless we have otherwise agreed with you in writing, we shall treat your instructions to us to place or renew your insurances as acceptance of the limitation of our liability to you, and to any other person with an interest in your insurances, as follows.

Other than in respect of any claim:-

• resulting from our breach of the FSA’s rules; or

• resulting from our fraudulent acts or any of our acts which are deliberately contrary to our agreement with you; or

• in relation to any liability for death or person injury resulting from our negligence; or

• in relation to any liability which cannot lawfully be excluded or limited

our liability in contract, tort (including without limitation negligence) or otherwise will be limited to £10 million in respect of all services we provide to you over any twelve month period.

Our status

The FSA’s rules require us to inform you whether the information and/or advice we give you about insurance are on the basis of:-

• a “fair analysis” of the market or, in other words, on the basis of an evaluation of a sufficiently large number of contracts available in the relevant sector or sectors of the insurance market to enable us to give advice or provide information to you on your insurances which is adequate to meet your needs; or

• an evaluation of a limited number of insurers; or

• the terms offered by a single insurer.

Your specific circumstances will dictate which of these bases is the most appropriate to you.  The approach which we adopt, will be based on our knowledge of the market, the quality of an insurer’s policy terms and claims service and the insurer’s ability to provide definitive contract terms at inception of insurance.  We will, therefore, place your insurances on the basis of an evaluation of a limited number of insurers or on the basis of the terms offered by a single insurer where we consider that to do so would match your requirements or instruction.

We will tell you which of these approaches we have adopted in placing or renewing your insurances. We will also tell you if we are contractually prevented from providing information on the basis of a “fair analysis”.

In certain cases, insurers authorise us to underwrite and settle claims on their behalf within agreed guidelines.  Accordingly, in placing your insurances and handling claims, we may act as agent for insurers as well as for you.  This will prevent us prevent us from advising you independently on the insurance policy and insurer most appropriate to your requirements.

Our remuneration

Unless we have agreed with you otherwise, payment for our services will be by way of commission which is deducted from the premiums you pay to insurers.

Our remuneration (in whatever form) in respect of any policy will be due on the date of inception or date of renewal of that policy.  We will be entitled to retain all commission or agreed fees in respect of the full policy period including where those policies are cancelled after inception or where you appoint another intermediary in our place during the currency of a policy.

Some insurers may make additional payments to us reflecting the aggregate income and/or profitability of their account with us and/or in respect of work we undertake on their behalf.  Where we place any of your insurances through another Lonmar group company, that company may also receive from insurers commission and/or payments of the type described.  Where we arrange third party finance for your premiums, the third party financier may make additional payments to us by reference to the level of interest you pay.  We will provide you with written details of any payments of the types described, or of the basis on which any such payments may be made, if you ask us to do so.

Your obligations

Your legal obligations are as follows:

• when instructing us to place or to renew insurances on your behalf, to disclose to us any material facts; that is, any facts known to you (or which ought to be known to you) in the ordinary course of your business likely to influence an insurer’s decision whether or not to accept the risk and on what terms and at what premium to accept the risk

• to disclose to us any material facts arising whilst your insurances are in force, whenever you wish to renew your policy, to effect any mid-term changes to your policy or to make a claim

All answers or statements given on a proposal form, claim form or other document relevant to your insurances will be your sole responsibility and you should always check the accuracy of the information you provide to us and/or insurers.

            Failure to disclose, or misrepresentation of, material facts entitles insurers to decline claims and may lead to your policy being completely invalidated.

            You should seek our advice if you are in any doubt as to whether any facts might be material.

• to pay premiums in cleared funds within the period stipulated in the debit notes we send you and to provide sufficient details of any remittance you make to enable us to allocate it against specific transactions.

Failure to pay premiums by the date specified in a debt note may lead to cancellation of your insurances by insurers or by us and failure to pay premiums in accordance with a premium payment warranty or premium payment condition can result in automatic cancellation of your insurances.  Where a premium payment warranty or premium payment condition applies, you will need to pay the premium to us in sufficient time to enable us to pass cleared funds to insurers.

We reserve the right to retain any policies until all payments due under those policies have been made and any cheques cleared through our bank account.

We accept no liability to pay premiums to insurers unless we have received cleared funds.

• to comply with the terms of the insurance contract you purchase including any subjectivities or express or implied warranties

            Failure to comply will entitle insurers to cancel your insurance contract.

• to advise us without delay and in accordance with the terms of your insurance contract of any claim or circumstances likely to give rise to a claim under your insurances.

            Delay in notifying a claim may entitle insures to decline a claim.

You should also:

• when instructing us to place or to renew insurances on your behalf, clearly indentify your circumstances and requirements and advise us if the statement of your demands and needs, which we will provide to you before or shortly after the insurance contract is concluded, is incorrect or if there has been any change to statements of demands and needs given in respect of prior insurances

• review any policy or other confirmation of cover se send and advise us immediately if you consider that it does not reflect your demands and needs

• act as if uninsured and take all prudent and reasonable steps both to prevent injury or damage of the type covered by the insurances and also take all such actions after the event as are sensible to minimise its loss

• retain any insurance policies in a safe place.

We recommend that you give us your instructions in writing and that where you instruct us orally, you confirm those instructions in writing.

Confidentiality and your personal data

We will treat all of the information you provide us as private and confidential to us and those involved in providing your insurances (including loss adjusters and claims handlers) appointed by insurers).  We will not give anyone else any information about you, except:

• when you ask us to or give us permission
• If we have to because we are regulated by the FSA
• If we have to by law.

Unless you advise us otherwise, we shall assume that we have your permission to disclose data about you, and the permission of any individual whose personal data you disclose to us to disclose that data:

• where necessary for the purposes of handling your insurances

• where necessary for the purposes of transferring or delegating our responsibilities for the handling of your insurance to any other intermediary regulated by the FSA

• to other companies within the Lonmar group which are regulated by the FSA for the purposes of enabling them to advise you of any services which may be relevant to your requirements.

Money Laundering/Proceed of Crime Act

We may ask for evidence of your identity at the start of our business relationship.  In the absence of such evidence we may be able to act for you.  In accordance with our obligations under the Proceeds of Crime Act 2002 and other anti-money laundering legislation, where knowledge or suspicion of money laundering arises, we may pass certain information known to, or suspected by, us to the appropriate authorities.  This may result in a delay to a transaction and/or a decision that we will cease acting for you.

Claims payments will ordinarily be made to you (unless we make payment to a third party with an interest in your policy).  If you require a payment to be made to a third party then you must confirm the requested payee’s name and details and provide a brief explanation for your request.

Complaints

If you have a complaint about our services, you should in the first instance contact the member of our staff with whom you normally deal.  You may make your complaint either orally or in writing.  If we are unable to resolve your complaint by close of business on the business day following receipt of your complaint, we will send you a copy of our complaints procedure.  We will acknowledge your complaint in writing within 5 business days and tell you who will be dealing with your complaint and when you can expect to receive a response and will enclose a further copy of our complaints procedure.

We will give a written response within four weeks of receiving your complaint unless your complaint is sufficiently complicated to warrant longer investigation or if it requires information outstanding from a third party.  We will advise you in writing of the reasons if our response will take longer than four weeks and will let you know when a response can be expected.  We will respond in writing within eight weeks of receipt of your complaint unless it is still not practicable to do so.  If we are unable to respond within eight weeks, we will advise you in writing of the reasons for the further delay and explain when we expect to provide a final response.  You may be entitled to refer your complaint to the Financial Ombudsman Service if you are dissatisfied with the response or the delay in our response.

Our final response will state whether we accept or reject your complaint.  If we reject your complaint, we will give full reasons for doing so.

If you remain dissatisfied after receiving our response, or it at any time you are dissatisfied with the way in which our complaint is being handled, you should contact our compliance officer at the address shown below.  Our compliance officer will review your original complaint and the response you have received and will advise you whether we will take any further action on the basis of his or her review.

Compensation

We are covered by the Financial Services Compensation Scheme (FSCS).  You may be entitled to compensation from the scheme if we cannot meet our obligations.  This depends on the type of business and circumstances of the claim.

Insurance advising and arranging is covered by the FSCS for 100% of your claim if it relates to compulsory insurance.  For other cases, it is covered for 100% of the first £2,000 and 90 per cent of the remainder of the claim, without any upper limit.

Further information about compensation scheme arrangements is available from the FSCS.

Termination

Either you or we may terminate the agreement for the provision of our services by giving at least thirty days notice in writing.  In the event of termination, we shall be entitled to receive in full our commission or fee in respect of any policies we have placed on your behalf before the date of termination.

Governing Law and Language

The relationship between us as a broker and you as customer is governed by English law.  If there is a dispute which cannot be resolved under our complaints procedure, it will only be dealt with in the courts of England and Wales.

These terms of business are supplied only in the English language and all communications for the duration of our appointment will be in the English language unless, if you are a customer in a European Economic Area state other than the United Kingdom, you require otherwise.

Severability

If any provision of these Terms of Business is found to be invalid or unenforceable in whole or in part the validity of the other provisions of these Terms of Business and the remainder of the provision in question will not be affected.

Rights of Third Parties

No provision of these Terms of Business will be enforceable, by virtue of the Contracts (Rights of Third Parties) Act 1999, by any person other than you or us.

LONMAR GLOBAL RISKS LIMITED, MATRIX HOUSE, 9 ALDGATE HIGH STREET, LONDON EC3N