Additional Business Terms

Business Terms for Programs Placed through Aon’s Global Broking Center London (GBCL)

The GBCL’s Approach to Marketing Your Risks

The GBCL will always seek to negotiate competitive terms in line with Your instructions and use its judgment and experience to evaluate effective placement methods or combinations of methods to meet these requirements.

A large program may be structured into various individual placements or layers underwritten by either a single insurer or subscription markets. Typically when utilizing subscription markets the GBCL will invite follow insurers to quote below the lead price, or to quote independently, in an effort to achieve or improve the agreed target or composite price for You.

In certain instances, the GBCL may only approach one insurer to provide a lead quotation (or a single insurer who is able to underwrite alone the terms, conditions and limit required). Where this is the case, the GBCL will advise of the reason why it has taken this approach. Otherwise the GBCL will approach multiple insurers to provide either lead quotations or single market solutions. Typically this will be a limited number of insurers for the class of business; however, the GBCL will advise when it has approached an appropriate number of insurers to reflect a fair analysis of the market. A list of insurers considered and/or approached to provide quotations is available upon request. The GBCL will confirm the pricing obtained from all subscribing insurers to demonstrate whether all subscribing follow insurers elected to support the lead price or quoted at a varied price from the lead.

The GBCL’s Placement Methods

Where appropriate the GBCL may utilize the following placement methods:

a. Aon UK Limited operates several market facilities to enable the efficient placement and servicing of risks fitting a prescribed profile that, in the open market, may otherwise be difficult to place or could attract higher premiums. These facilities may be underwritten by one or more insurers and may be used alone or in conjunction with single or subscription markets to deliver capacity for larger risk exposures. Access to these facilities throughout a Client’s policy period is a benefit exclusive to Aon Clients and is not available through alternative brokers or intermediaries.

b. The GBCL operates several market facilities where additional functions that insurers would normally perform are transferred to Aon, and the insurers pay Aon UK Limited certain management service fees and work transfer fees for carrying out these functions on their behalf. A number of these facilities include binding authorities or other delegated authorities that give Aon Underwriting Managers (AUM) underwriting authority to act as a Managing General Agent (MGA) on behalf of insurers. In addition to any commission earned by the GBCL, AUM is remunerated for the work undertaken on behalf of the insurer and this may include profit or contingent commission. AUM delegated authorities may also be branded as ‘Maven’.

Details will be provided if a market facility has been used for Your insurance placement or where Aon has placed any participation via an arrangement where Aon UK Limited is acting as an MGA on behalf of an insurer.

c. Aon UK Limited has entered into arrangements whereby it offers the capacity of insurer(s) to its Clients in respect of certain qualifying risks. A pre-agreed percentage of the risk can be bound at the qualifying lead insurer’s price, terms, conditions and limits. These arrangements are bound and administered by AUM as MGA on behalf of the subscribing insurers.

Aon UK Limited currently has an arrangement with:

– Aon Client Treaty: Various Underwriters at Lloyd’s via Syndicates 9512, 9529, 9531, 9532, 9533, 9534, 9535, 9536, 9537, 9538, 9541, 9542, 9544, 9546, 9547, 9548, 9549, 9551, 9553, 9554 and 9555. The identity of specific participating Lloyd’s syndicates is available on request.

d. Facultative reinsurance may be arranged for insurers to enhance a Client’s original placement.

Collection and Use of Your Information

The GBCL may transact business on Your behalf, including the submission of claims and underwriting information, by means of electronic placement and claims systems. This may require, in the case of electronic claims submissions, the submission of documents to a market repository which will be available to insurers. Such market repository may be operated by a third party. Data will be held in accordance with data protection requirements.

Should You seek additional information about Aon’s GBCL (including details in relation to commissions received by Aon UK Limited through the placement of Your insurance program), please contact Your broker.

New disclosure obligations relevant to insurance contracts that are subject to the laws of England, Wales, Scotland or Northern Ireland: Your Duty to Make a Fair Presentation

You are legally required to make a fair presentation of the risk You are seeking to insure to Your insurer. To make a fair presentation of the risk You must either (1) disclose all Material Information (described below) that You know or ought to know or (2) provide insurers with sufficient information to put them on notice that they need to ask You further questions to reveal all the Material Information.

“Material Information” means all information that would influence an insurer in determining whether to accept a particular risk and, if so accepted, the premium, terms and conditions to be applied to that risk.

You will be deemed to know all Material Information that is known to Your senior management or those responsible for arranging Your insurance, and which should reasonably have been revealed by a reasonable search. Your search will need to include information which is held by other persons (for example, your insurance broker, Aon), and Your agents. You agree that Aon is not required to provide You or insurers with any information that We have received (i) from anyone other than You or those acting on your behalf or (ii) otherwise than directly in connection with the particular contract of insurance We are placing for You. Any losses You suffer as a result of any related non-disclosure or misrepresentation will be Your responsibility.

Failure to disclose all Material Information or misrepresenting circumstances could result in the terms of Your insurance contract being rendered void (so that claim(s) are not paid and there is no cover), terms being amended or insurers reducing any claim(s) paid in proportion to the increased premium that would have been charged had the true position been known. Insurers may also have a right to recover all or part of any claim payments made.

The disclosure obligations outlined above will arise before the policy is entered into and after the policy is entered into as the duty to make a fair presentation is re-imposed when there are changes or variations in cover, when the insurance contract is renewed or extended and when You make a claim.