OHJE YLEISEN EDUN VAATIMISTA EHDOISTA ETA-VAKUUTUSEDUSTAJILLE

Transcription

1 Vakuutusvalvonta OHJE YLEISEN EDUN VAATIMISTA EHDOISTA ETA-VAKUUTUSEDUSTAJILLE Anvisning om de villkor som påkallas av allmänt intresse för EES-försäkringsförmedlare Conditions required by general good for EEA-insurance intermediaries Vakuutusvalvontaviraston julkaisusarja MÄÄRÄYKSET JA OHJEET 2005:5

2 INSTRUCTION Diary no 8/002/2005 To Insurance Intermediaries registered in other state in European Economic Area than Finland Section of the law: Section 32 of the Act on Insurance Mediation (570/2005) Department: Market Affairs CONDITIONS REQUIRED BY GENERAL GOOD The Insurance Supervisory Authority inform with reference to Section 32 of the Insurance Mediation Act (570/2005) enclosed instruction on the conditions required by general good for insurance intermediaries registered in other state in European Economic Area than Finland. Instruction on conditions required by general good can also be found on the website of the Insurance Supervisory Authority ( Director General Hely Salomaa Senior Officer Janne Sinisalo ENCLOSURE Conditions required by general good

3 Contents 1 CONDITIONS REQUIRED BY GENERAL GOOD ACT ON INSURANCE MEDIATION (570/2005) Legal Provisions to be applied Definition of an Insurance Agent and Insurance Broker Disclosing Information on an Insurance Agent s or Insurance Broker s operations Insurance Intermediary s marketing Insurance Broker s Fee LANGUAGE OF INFORMATION GIVEN TO INSURANCE APPLICANT AND POLICYHOLDER CONSUMER PROTECTION ACT (38/1978) PERSONAL DATA FILE ACT (523/1999) PREMIUM TAX FIRE PROTECTION FEE GUIDELINES INSURANCE SUPERVISORY AUTHORITY S COMMENT ON THE MARKETING OF SAVINGS UNDER LIFE INSURANCE LEGAL REMEDIES AT THE CUSTOMER S DISPOSAL...29

4 25 1 CONDITIONS REQUIRED BY GENERAL GOOD An insurance intermediary registered in a member state of the European Economic Area (EEA country) other than Finland and operating in Finland on the basis of the right of establishment or the right of free provision of services must take account of the following terms and conditions required by the general good, among others. These conditions contain information on legislation valid in Finland and of significance to the operations of the insurance intermediary. For the purposes of these terms and conditions, an insurance intermediary refers to both an insurance intermediary and a reinsurance intermediary as defined in Article 2 (5) and (6) of Directive 2002/92/EC of the European Parliament and of the Council on insurance mediation. Clauses , 1.2 and 1.3 of these terms and conditions do not apply to a reinsurance intermediary. 1.1 ACT ON INSURANCE MEDIATION (570/2005) Legal Provisions to be applied When an insurance or reinsurance intermediary registered in an EEA country other than Finland operates in Finland, the provisions of the Finnish Act on Insurance Mediation are applied, excluding Sections 6 13, and 41. Neither are Sections 19 23, 25, 26 and and Section 40, Sub-sections 2 4 of the said Act applied to a reinsurance intermediary. An insurance intermediary engaged in direct insurance mediation must also take into account the provisions of Section 5 of the set of regulations and guidelines, Record No. 1/002/2005, issued by the Finnish Insurance Supervisory Authority for insurance intermediaries, on assignment agreements between insurance brokers and their customers, and the provisions of Section 6 on fair analysis. With respect to insurance intermediaries operating as insurers agents and engaging in direct insurance mediation, the provisions of the Insurance Contracts Act (543/1994), Section 5, Sub-sections 1 and 2 and Section 9, are applied in addition to the Act on Insurance Mediation Definition of an Insurance Agent and Insurance Broker According to Section 3 of the Act on Insurance Mediation, an insurance intermediary registered in Finland is either an insurance agent or an insurance broker. An insurance agent refers to a natural or legal person who pursues insurance mediation under contractual obligation on behalf of and under the supervision of one or several insurers. An insurance broker refers to a natural or legal person who pursues insurance mediation on the basis of an assignment agreement concluded with a customer other than an insurer carrying out direct insurance business. Independence from insurers is required from all insurance brokers registered in Finland. An insurance broker must not be in an employment relationship or insurance agent relationship with one or several insurers, nor in a relationship based on a contract, ownership or other dependence which may influence the broker s actions against the interests of the customer. If, from the customer s viewpoint, the services provided by an insurance intermediary registered in an EEA country other than Finland substantially differ from those that an insurance agent or broker referred to in the Act on Insurance Mediation can provide, the insurance intermediary must clearly state this in its marketing and other operations. The customer must be able to gain a true picture of the insurance intermediary s role and services before making decisions or contracts vis-à-vis the insurance intermediary regarding the insurance intermediary s

5 26 services. The following sections describe the contents of the Act on Insurance Mediation insofar as an insurance intermediary must take particular account of them Disclosing Information on an Insurance Agent s or Insurance Broker s operations According to Section 21 of the Act on Insurance Mediation, in all activities an insurance agent must clearly inform the customer that it is acting as an agent. According to Section 27 of the said Act, in all activities an insurance broker must clearly state that it is acting as an insurance broker. Moreover, only a registered insurance broker is entitled to use the designation insurance broker or insurance intermediary in its business name or otherwise for defining its operations. An insurance agent or broker must not use the designation insurance intermediary misleadingly in its operations, making it unclear to the customer whether the insurance intermediary is an insurance agent or an insurance broker. If the concept insurance intermediary is used, the customer must be clearly and simultaneously informed of whether the said insurance intermediary operates as an insurance agent or an insurance broker. If the insurance intermediary is registered under another designation in its home member state, the insurance intermediary must inform the customer of the said designation Insurance Intermediary s marketing Section 22 of the Act on Insurance Mediation contains provisions on an insurance intermediary s marketing. In its marketing, an insurance intermediary must provide the customer with all information on its insurance mediation services and the insurance offered that may prove significant when the customer takes decisions concerning the said services or insurance. In its marketing, an insurance intermediary may not give false or misleading information or use any methods that are inappropriate vis-à-vis the customer or that are contrary to good insurance practice or good insurance brokerage practice. Marketing that does not include information needed for the customer s financial security must always be considered inappropriate. In its marketing, an insurance agent must specify which insurers it represents and, when marketing a single insurance product, which insurer s product it is. An insurance broker registered in Finland must not state in its marketing that it represents one or several insurers because an insurance broker cannot altogether represent an insurer. Thus, an insurance broker cannot market the insurance products of a certain insurer or certain insurers. An insurance broker can market insurance products only on a general level, offering, for example, life insurance as an investment opportunity. If an insurance agent or broker registered in an EEA country other than Finland can, under the legislation of its home member state, act in a manner not possible for an insurance agent or broker registered in Finland in accordance with the definition of, and marketing rules applied to, an insurance agent or broker, the said insurance intermediary must give a true picture in its marketing of its services, notwithstanding what was stated in the previous paragraph on an insurance agent s or broker s marketing. This also applies to an insurance intermediary that has been registered in its home member state under a designation other than insurance agent or insurance broker. In such a case, the insurance intermediary must specify the insurers whose products it exclusively mediates and whether the insurance intermediary provides information on the basis of a fair analysis as stated in Section 25, Sub-section 2 of the Act on Insurance Mediation. An insurance intermediary must provide all information on its services necessary for the customer. An insurance intermediary must not omit information, said omission giving the customer a false or misleading picture of its services. For example, an

6 27 insurance intermediary operating under the designation insurance broker must clearly inform the customer if it can be tied to insurers in a manner not possible for an insurance broker registered in Finland Insurance Broker s Fee According to Section 26 and Section 49, Sub-section 6 of the Act on Insurance Mediation, an insurance broker operating in Finland may, after a three-year transition period commencing on 1 September 2005, accept a broker s fee only from the principal, i.e., the customer. During the said transition period, the insurance broker may also accept a broker s fee from a party other than the customer. When providing the customer with a fair analysis, the insurance broker must inform the customer of the basis for determining the broker s fee paid by the insurer and any other party regarding the insurance solutions covered by the said analysis and, if possible, the amount of the fee. During the transition period, the insurance broker must inform the customer of the amount of, and the basis for determining, the broker s fee with respect to an insurance contract concluded by the customer, as well as the amount of, and the basis for determining, the broker s fee if these have fundamentally changed from what has been reported earlier. Such information must be provided in writing unless otherwise agreed by the insurance broker and customer. What is stated above in this section applies only to contracts concluded on 1 September 2005 or thereafter. With respect to contracts concluded prior to the said date, the regulations valid upon the entry into force of the Act on Insurance Mediation will be applied. 1.2 LANGUAGE OF INFORMATION GIVEN TO INSURANCE APPLICANT AND POLICYHOLDER If an insurance intermediary provides insurance mediation services in Finland to consumers or traders comparable to consumers as the insurer s counter party in view of the type and scale of their business operations and the general circumstances, good insurance practice and good brokerage practice require that the agent and insurance broker provide the insurance terms and conditions and other information given to the applicant and policyholder about the insurance in the applicant s or policyholder s mother tongue if it is Finnish or Swedish. The insurance intermediary can only diverge from this with the express consent of the applicant or policyholder. 1.3 CONSUMER PROTECTION ACT (38/1978) When providing insurance mediation services to consumers, an insurance intermediary must take into account Chapters 2 4 of the Consumer Protection Act. However, the Act does not apply to statutory insurance or employees group life assurance. Chapter 2 of the Consumer Protection Act contains provisions on marketing. In addition to general provisions corresponding to Section 22 of the Act on Insurance Mediation, the chapter also contains provisions, for instance, stating the price of a consumer commodity, tie-in offers and benefit depending on chance. Chapter 3 of the Consumer Protection Act concerns the regulation of contract terms and conditions. It should be noted in particular that when offering consumer commodities, a trader may not use a contract condition that could be deemed unreasonable from the consumer s point of view, considering the price of the commodity and other relevant factors. Chapter 4 of the Consumer Protection Act contains provisions on adjustment and interpretation concerning a consumer contract. Adjustments can be made in the case of an unreasonably priced consumer commodity and

7 28 other unreasonable contract terms. According to the provision on the interpretation of a standard agreement, a contract condition must be interpreted to the consumer s advantage if it was drawn up in advance without the consumer being able to influence it and its significance is in any way unclear. In addition to the Insurance Supervisory Authority, the Consumer Ombudsman supervises the legality of marketing and the use of contract conditions from the point of view of consumer protection. The Ombudsman draws up marketing instructions and negotiates sectoral contract terms that will ensure consumers the minimal level of statutory legal protection. These instructions then regulate the behaviour of traders in the sector concerned and form the basis for when the legality of marketing measures or the reasonableness of contract conditions are assessed. The Ombudsman has issued marketing instructions, for instance, on the marketing of individual pension insurances (1997). 1.4 PERSONAL DATA FILE ACT (523/1999) The Personal Data File Act applies to the automatic processing of personal data concerning a natural person and other processing of personal information when these data comprise, or will be used to comprise, a personal register or part of such a register. The Act applies to such personal data processing when the register keeper has a place of business in Finland or otherwise within Finnish jurisdiction. The Act contains provisions on general principles related to personal data processing, the processing of sensitive information and personal codes, the rights of registered parties, and data security and the storage of data. 1.5 PREMIUM TAX State tax must be paid on the premiums of certain insurance contracts if so stipulated by the Act on Tax on Certain Insurance Premiums (664/1966). All parties engaging in insurance business in Finland are liable to pay this tax. However, if the insurance premium is paid to an insurer not engaging in insurance business in Finland, the party liable to pay the tax is the policyholder. 1.6 FIRE PROTECTION FEE According to Section 1 of the Act on the Fire Protection Fund (306/2003), an annual fire protection fee must be paid on any movable or immovable property covered by fire insurance in Finland in order to promote fire prevention and rescue services. According to Section 2 of the said Act, anyone carrying out insurance business in Finland is liable to pay the fire protection fee. If the insurance premium is paid to an insurer not engaging in insurance business in Finland, the policyholder and the insurance broker are responsible for paying the fire protection fee. The insurance broker is responsible for forwarding the fire protection fee as stipulated in Section 5 of the said Act. 2 GUIDELINES 2.1 INSURANCE SUPERVISORY AUTHORITY S COMMENT ON THE MARKETING OF SAVINGS UNDER LIFE INSURANCE The Insurance Supervisory Authority has issued a comment on the marketing of savings under life insurance (Record No. 1/002/2002) regarding life and pension insurance agreements which include pure endowment savings-based coverage and, to an applicable extent, group pension insurance policies. The said comment also concerns capital redemption policies. The comment constitutes guidelines on what information insurers must provide in product advertising directed at the general public and on product information insurers must provide to individual customers.

8 LEGAL REMEDIES AT THE CUSTOMER S DISPOSAL The following legal remedies referred to in Section 19, Sub-section 1, Item 5 of the Act on Insurance Mediation are at the disposal of the customer and other interested parties. A dispute to be submitted to a court of law for resolution can be initiated by submitting a written application for a summons to a local court. As a principal rule, the matter can be considered by a court within whose jurisdiction the defendant has his or her home and domicile or is running, or has run, a business. In a dispute between a consumer and a trader, the consumer can also institute legal action in the local court within whose jurisdiction the consumer has his or her domicile. Outside the court system, disputes are handled by the Finnish Insurance Ombudsman Bureau, the Finnish Insurance Complaints Board and the Consumer Complaints Board whose services are free of charge. A customer of an insurance intermediary operating as an insurance agent can submit his or her case to the Finnish Insurance Ombudsman Bureau, whose operations are based on an agreement between the Finnish Consumer Agency and the Federation of Finnish Insurance Companies. The Finnish Insurance Ombudsman Bureau issues advice and helps in insurance matters both prior to and after taking out insurance. It covers all voluntary insurance, workers compensation insurance, motor third party liability insurance, patient insurance and environmental insurance as well as company- and industry-wide pension funds supplementary pension insurance. A customer of an insurance intermediary operating as an insurance agent can submit his or her case to the Finnish Insurance Complaints Board, whose operations are based on an agreement between the Finnish Consumer Agency and the Federation of Finnish Insurance Companies. The Board considers matters related to voluntary insurance as well as those related to motor third party liability insurance insofar as the Traffic Accident Board is not competent to consider a motor third party liability insurance issue. The Finnish Insurance Complaints Board issues opinions in the nature of recommendations. A customer of an insurance intermediary comparable to a consumer can submit his or her case to a Consumer Complaints Board complying with the Act on the Consumer Complaints Board (42/1978) that makes recommendations for settling disputes between traders and consumers in individual matters related to consumer commodity contracts or other cases concerning the purchase of a consumer commodity. The Board thus also issues recommendations in matters related to the services of an insurance intermediary.

9 Vakuutusvalvonta Vakuutusvalvontavirasto Mikonkatu 8, PL Helsinki Försäkringsinspektionen Mikaelsgatan 8, PB 449 FIN Helsingfors Insurance Supervisory Authority Mikonkatu 8, P.O. Box 449 FIN Helsinki