Additional Provisions regarding programs placed by the Global Brokerage Centre London (“GBCL”)

Additional Provisions regarding programs placed by the Global Brokerage Centre London (“GBCL”)

These terms together with any additional documentation which Aon may provide to Client in connection with the GBCL, during the provision of Aon’s Services, set out the basis of Client’s relationship with the GBCL.

1. Role of GBCL

The GBCL operates as a wholesale insurance broker which means that Aon takes instructions from and provide Aon’s opinion and recommendations to the Aon office who Client has contracted with (“Local Aon Office”) who will in turn communicate with Client. Any activities which can only be undertaken by an authorized or regulated entity in Client’s jurisdiction will be performed by Client’s Local Aon Office. If Client has any questions about Client’s insurances or these requirements, Client should discuss them with Client’s usual Local Aon Office contact.

2. Regulated Status

2.1 Depending on the jurisdiction in which Client is resident or established, placement(s) may be affected by the GBCL comprised in Aon UK Limited (“Aon UK”) or Aon Belgium B.V. (acting through its UK branch) (“Aon Belgium”) on behalf of Client’s Local Aon Office.

2.2 Aon UK Limited is a company incorporated in England and Wales (registered number 0210725) and has its registered office at The Aon Centre, The Leadenhall Building, 122 Leadenhall Street, London, EC3V 4AN.

2.3 Aon UK Limited is authorised and regulated by the UK’s Financial Conduct Authority (“FCA”). Aon UK Limited’s Financial Services Register number is 310451. Client can check this, together with Aon UK Limited’s permissions to provide certain regulated products and services, on the Financial Services Register by visiting the FCA’s website https://register.fca.org.uk/ or by contacting the FCA on +44 (0) 800 111 6768.

2.4 Aon Belgium B.V. is a company incorporated in Belgium in the form of a limited liability company (société privée à responsabilité limitée/besloten vennootschap met beperkte aansprakelijkheid), with its registered office at Telecomlaan 5-7, 1831 Diegem, Belgium and registered with the Crossroads Bank of Enterprises under number 0426.531.863 (Commercial court of Brussels, Dutch-speaking division). Aon Belgium B.V. is registered in the UK with Companies House as an overseas company under company number FC035883.

2.5 Aon Belgium B.V. is authorised and regulated in Belgium as an insurance intermediary by the Belgian Financial Services and Markets Authority (“FSMA”) under number 013982. Client can check this on the Insurance Intermediaries Register by visiting the FSMA’s website https://www.fsma.be/nl/verzekeringstussenpersoon.

2.6 Aon Belgium B.V. and its UK Branch is authorised and regulated by the UK’s Financial Conduct Authority. Aon Belgium’s Financial Services Register number is 972556. If Client has any questions in relation to the UK Branch Client can contact: Head of Branch Operations, Aon Belgium B.V. UK Branch, The Aon Centre, The Leadenhall Building, 122 Leadenhall Street, London, EC3V 4AN.

3. Client’s Duty to Make a Fair Presentation

3.1 Where Client’s insurance policy arranged by the GBCL is governed by the laws of England and Wales, Scotland or Northern Ireland, Client’s disclosure obligations are summarized below.

3.2 By statute, Client is legally required to make a fair presentation of the risk that Client are seeking to insure to the insurer. To make a fair presentation of the risk Client must disclose all Material Information (described below) that Client knows or ought to know or failing that provide disclosure which gives the insurer sufficient information to put a prudent insurer on notice that it needs to make further inquiries. Client should keep in mind that this is not meant to result in a two-stage process where Client provides insurers with little information and they ask all the questions. In addition, Client must make the disclosure in a manner which would be reasonably clear and accessible to a prudent insurer. Every material representation as to a matter of fact must be substantially correct and every material representation as to a matter of expectation or belief must be in good faith.

3.3 “Material Information” means any circumstance or representation which is material in that it would influence the judgment of a prudent insurer in determining whether to take the risk and, if so, on what terms. If Client are in doubt as to whether information might be relevant to an insurer’s determination, Aon would advise that Client disclose it.

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

3.5 Failure to disclose all Material Information or misrepresenting circumstances could result in the terms of Client’s 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.

3.6 The disclosure obligations outlined above will arise before the policy is entered into. Therefore, if Client becomes aware that information that Client has supplied prior to confirmation of Client’s insurance cover was incorrect or incomplete, Client should tell Client’s usual Local Aon Office contact immediately. Representations may be withdrawn or corrected before the policy is entered into.

3.7 The disclosure obligations outlined above also arise 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 Client makes a claim. In addition, changes which relate to compliance with a warranty or condition in the insurance contract must be notified at once. Some insurance contracts also contain an express obligation to notify any change in risk. Client needs to ensure that Client is familiar with the terms of Client’s policy and have taken any advice Client requires to understand the implications.

3.8 If the policies are written under the laws of other jurisdictions, other requirements may apply under applicable law.

4. Safeguarding Client’s Money

4.1 Where Aon Belgium acts on Client’s behalf it works based on a “Risk Transfer”. This means that premium received from Client by Aon Belgium is deemed to have been received by the insurer. In such circumstances, premiums Aon Belgium receives are held as insurer money (“Insurer Money”) in a designated account. Conversely, claims payments and/or premium refunds will only be treated as having been received by Client when they are actually paid to Client.

4.2 Where Aon UK acts on Client’s behalf it shall hold premiums due to insurers, any claims payments and/or premium refunds due to Client as client money (“Client Money”). During the provision of the Service to Client, Aon UK and any of its Appointed Representatives (as defined in law and the FCA rules) will deposit all payments received in respect of Client Money in a bank account governed by a trust deed, which is a Non-Statutory Trust (NST), that complies with FCA rules (“Trust Account”). The FCA rules seek to protect clients against any inability of an insurance broker to transfer premiums to an insurer or to transfer claims payments and/or premium refunds to the client. Client Money subject to Scottish Law will be held by Aon acting as Client’s agent. The fact that Aon hold money on trust also gives rise to fiduciary duties which will be owed to Client until the money reaches the insurer or the duty is otherwise validly discharged.

4.3 In some instances, the insurer may also grant Aon UK “Risk Transfer”. Aon UK may then co-mingle Insurer Money with Client Money under the terms of the same trust deed when permitted by the FCA to do so.

4.4 Where Aon UK acts on Client’s behalf in respect of activities other than insurance distribution activities that are regulated by the FCA it may not be permitted by the FCA to hold Client Money in the same Trust Account as it uses for regulated activities. In this case Aon UK will hold Client Money in segregated bank account(s) established solely for this purpose.

4.5 The terms of the Trust Account(s) permit Aon UK to use the money held in connection with insurance distribution activities in the Trust Account (“Trust Monies”) on behalf of one client to pay another client’s premium before the premium is received from that client and to make claims payments and/or premium refunds to another client before Aon UK receives payment from the insurer. However, Aon UK is not permitted to use Client Money for any other purpose.

4.6 In the normal course of business and within the standard terms of its Trust Accounts arrangements, Aon UK retains the right to place part of the Trust Monies into a restricted range of investments which include deposit accounts and money market funds. However, under the terms of the Trust Accounts Aon UK remains liable for meeting any trust fund shortfalls that may arise as a result. In accordance with market practice, Aon UK retains all interest and earnings received on Trust Monies.

4.7 Aon UK will pay premiums directly to insurers and receive premium refunds and/or claim payments directly from insurers or their representatives except where Aon have engaged the services of another intermediary or settlement agent in which case settlements may then be transferred between Aon UK and the other intermediary or settlement agent. Should such an intermediary or settlement agent be located outside of the United Kingdom, payments will be made to and from their jurisdiction and will be subject to a legal and regulatory regime different from that of the United Kingdom. In the event of a failure of the intermediary or settlement agent, Client Money may be treated differently from the treatment which would have applied if it were held by an intermediary in the United Kingdom. Client may notify Aon if Client does not wish Client’s money to be passed to a person in a particular jurisdiction and Aon will consider making a payment to an alternative jurisdiction.

4.8 Aon UK may deposit Client Money in a client bank account outside the United Kingdom, unless Client notify Aon that Client does not wish Client’s money to be held in a particular jurisdiction. In such circumstances, the legal and regulatory regime applying to the approved bank will be different from that of the United Kingdom and, in the event of a failure of the bank, Client’s money may be treated in a different manner from that which would apply if the money were held by a bank in the United Kingdom.

4.9 Please note that fees and/or brokerage, where / if due, will normally be deducted by Aon on receipt of premium

4.10 We believe the above arrangements provide Client with significant and effective protection for Client Money. Client’s agreement to all aspects of these arrangements will be assumed unless an objection is registered with Aon or, where applicable, Aon’s appointed representative prior to Client’s first remittance being received by Aon.

5. Market Abuse Regulation

Client agrees to inform Client’s usual Local Aon Office contact immediately in writing if (i) any confidential information which Client provide to Aon, or intend to provide to Aon, constitutes “inside information” (within the meaning of Article 7 of Regulation (EU) No. 596/2014 on market abuse (“MAR”)) (“Inside Information”); and (ii) any Inside Information previously disclosed to Aon ceases to be Inside Information. Client agrees to clearly identify to Aon in writing which specific parts of the confidential information constitute, has become or ceased to be Inside Information. In the event that Client requires Aon to maintain an “insider list” (within the meaning of Article 18 of MAR) of individuals who have access to such Inside Information, Client agrees to notify Aon in writing prior to, or upon, providing such Inside Information. In the event that Client does not notify Aon that the Confidential Information Client has provided Aon with constitutes Inside Information or that Client requires Aon to draw up and maintain an insider list, Aon will have no obligation to draw up or maintain such list. For the avoidance of doubt, Aon shall not be required to draw up or maintain insider lists in respect of third parties.

6. The GBCL’s Approach to Marketing Client’s Risks

6.1 We will always seek to negotiate competitive terms in line with Client’s instructions provided via Client’s Local Aon Office and use our judgment and experience to evaluate effective placement methods or combinations of methods to meet these requirements.

6.2 In certain instances, Aon may only approach one insurer to provide a lead quotation (or full quotation where the insurer is able to underwrite alone the terms, conditions and limit required). Where this is the case, Aon will advise of the reason why Aon have taken this approach. Otherwise, Aon 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, Aon will advise Client’s Local Aon Office when Aon have 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 will be available upon request from Client’s Local Aon Office.

6.3 Client agrees and acknowledges that Client is responsible for the decisions made regarding the insurer(s) selected for Client’s insurance placement. The GBCL does not guarantee or warrant the availability of an insurance contract or the financial security, solvency or performance of any insurer. Client acknowledges and agrees that Aon is not the insurer.

7. The GBCL’s Use of Market Facilities

7.1 Where appropriate the GBCL may utilize market facilities in the placement of Client’s risk(s). Market facilities 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 or reduced coverage.

7.2 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.

7.3 A number of these facilities include delegated authorities that give Aon Underwriting Managers (“AUM”) and/or One Underwriting B.V. (“One Underwriting”) underwriting authority to act as a Managing General Agent (“MGA”) on behalf of insurers. AUM delegated authorities may also be branded as ‘Maven’. Access to these market facilities is an exclusive benefit to clients of the GBCL and is not available through alternative brokers or intermediaries.

7.4 This may include arrangements where a pre-agreed percentage of the risk can be bound at the qualifying lead insurer’s price, terms, conditions and limits. The GBCL currently has such arrangements with various Lloyds syndicates and Lloyds Insurance Company S.A. under the Aon Client Treaty (“ACT”) where risks are bound and administered by AUM and/or One Underwriting as MGA on behalf of the subscribing insurers. The identity of all participating insurers for ACT is available on request.

7.5 Details will be provided by Client’s Local Aon Office if a market facility has been used for Client’s insurance placement or where GBCL has placed any participation via an arrangement where AUM, One Underwriting or another Aon affiliate is acting as an MGA on behalf of an insurer (in either case, this will be clearly identified within the Security Details of the placement documentation). The GBCL shall be the exclusive broker of risks underwritten under such facilities for the duration of the relevant policy(ies) even if Client terminates Aon’s broker appointment mid-term. This will not apply if Client cancels the policy(ies).

7.6 In the operation of market facilities functions that insurers would normally perform are transferred to an Aon affiliate, (which may include GBCL, AUM, Aon Underwriting or other Aon affiliate) and the insurers pay the relevant Aon affiliate certain management service fees and work transfer fees for carrying out these functions on their behalf. This is in addition to any commission earned by Aon and may include profit or contingent commission.

7.7 Facultative reinsurance may be arranged by Aon for insurers who have provided quotes on your insurance placements. Any such facultative reinsurance placed will be under a separate arrangement between the reinsured, reinsurers and us. (Re)Insurers may independently remunerate Aon for these services.

7.8 We may also carry out certain aspects of the administration associated with Client’s placement on behalf of, or for the benefit of, open market insurers. Aon may receive additional remuneration for this activity from the insurers.

7.9 We are committed to transparency in Aon’s relationship. Client has the right to request details in respect of any additional remuneration earned by Aon in connection with Client’s insurance placement. Please contact Client’s usual Local Aon Office contact.

7.10 With respect to services provided by Aon Belgium, Client can consult Aon Belgium’s placement policy on: http://www.aon.com/belgium/du/attachments/2015/AssurMiFID-legislation-EN.pdf.

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