Page 4 - Personal Underwriting Mandates & Guidelines - Binder - Version 3

Fundamentals
FUNDAMENTALS
QUALITY OF INTERACTIONS WITH CUSTOMERS
The quality of the interaction with the proposer during the conclusion of a contract has a direct influence on claims processing and claim service delivery.
The sales and endorsement interactions can be concluded in several ways, i.e. telephonically, in person, etc., depending on the business model and type of product, therefore making it difficult to prescribe a set process. It does however, come down to an age-old legal concept – a meeting of the minds.
The full details, facts, processes and circumstances of the underwriting transaction form the foundation of the contract and will become the focal point at the time of a claim. If there is any doubt or flaw in that process or if it can be reasonably argued that the underwriting questions were unclear or ambiguous, the outcome of the claim will be made in favour of the claimant. Adherence to these mandates and guidelines is therefore crucial to ensure that all ambiguity is removed at inception of the policy and that the policy is underwritten in a fair and appropriate manner.
The binder holder must keep FAIS legislation in mind when selling any product to the client. If these standards are adhered to, then one can assume that the contract will commence on a sound footing.
DUTIES OF THE BINDER HOLDER
Binder holders are required to comply with the following:
○ be FAIS-compliant and suitably equipped to impart proper advice (as defined in the FAIS Act)
○ at all times render service honestly, fairly, with due skill, care and diligence, and in the interests of both the client and insurer while upholding the integrity of the financial services industry
○ ensure that all TCF requirements are adhered to
○ highlight areas that are critical, such as cover, limitations and exclusions, special conditions, claims process, etc.
○ any representations and information made or provided must:
– be factually correct
– be communicated in plain language
– consider the assumed knowledge of the customer
– avoid uncertainty and not be misleading.
The key words are presentation, flexibility and simplification.
POLICY DOCUMENTATION
The contract is not concluded until the written documentation has been dispatched to the insured within the prescribed time frame. Both the insurer and the binder holder have an obligation on conclusion of the sale, to ensure that policy documents are sent to the insured. It is also our joint responsibility to ensure the accurate production and delivery of such documentation.
Hollard’s responsibility in terms of delivery of a policy document to the insured depends on:
○ the channel through which the insured was introduced to Hollard
○ the agreement in place relating to policy fulfilment.
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