COB 7.5 COB 7.5 Authorised Firm's Duty of Disclosure
COB 7.5 Guidance
Authorised Firmis required to provide information to a Clientor potential Clientunder this section or any other section in this Chapter before providing a service or doing anything, then the information should be provided in good time before providing the service or doing the thing so that the Clienthas sufficient time to make an informed decision.Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]
COB 7.5.1(1) An
Insurer, Insurance Intermediaryor Insurance Managermust, subject to (3), disclose to a Client:(a) the name and address of the insurer or insurers effecting the Contractof Insurance;(b) its own name and address where different; and(c) contact details of the Personto whom a claim is to be notified.(2) The disclosures in (1) must be made before effecting or placing the Contractof Insurance, or as soon as reasonably practicable thereafter.(3) An Insurance Manageris not required to make the disclosure under (1) to an insurer to whom it provides Insurance Managementservices.
COB 7.5.2 COB 7.5.2(1) An
Insurance Intermediaryor Insurance Managermust, subject to (3), disclose to a Clientif:(a) it has a direct or indirect holding representing 10% or more of the voting rights or capital in an insurer; or(b) an insurer, or its parent undertaking, has a direct or indirect holding representing 10% or more of the voting rights or capital in the Insurance Intermediaryor Insurance Manager.(2) The disclosures in (1) must be made before providing Insurance Intermediationor Insurance Managementservices to the Client.(3) An Insurance Manageris not required to make a disclosure under (1) to an insurer to whom it provides Insurance Managementservices.Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]
COB 7.5.2 Guidance
Insurance Intermediaryor Insurance Manageris required to disclose the information under COB Rule 7.5.1(1) and COB Rule 7.5.2(1) to any Policyholderwith whom it interacts when carrying out its Insurance Intermediationor Insurance Managementactivities.Derived from DFSA DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]
COB 7.5.3 COB 7.5.3(1) An
Insurance Intermediarymust, before providing any Insurance Intermediationservice to a Personas a Retail Client, disclose whether any advice or information is or will:(a) be provided on the basis of a fair analysis of the market;(b) not be provided on the basis of a fair analysis of the market because of any contractual agreement it has with any particular insurer or insurers to deal with only their products; or(c) even if there are no contractual agreements of the type referred to in (b), not be provided on the basis of a fair analysis of the market.(2) If (1) (b) or (c) applies, the Insurance Intermediarymust, if requested by the Retail Client, provide to that Clienta list of insurers with whom it deals or may deal in relation to the relevant Contractsof Insurance.(3) An Insurance Intermediarymust, before providing any Insurance Intermediationservice to a Client, disclose to that Clientwhether it acts on behalf of an insurer or any other Personor acts independently on behalf of Clients.
COB 7.5.3 Guidance1. An
Insurance Intermediaryshould not represent itself as providing advice or information on the basis of a fair analysis of the market under COB Rule 7.5.3(1) unless it has considered a sufficiently broad range of Contractsof Insuranceand based its decision on an adequate analysis of those contracts.2. Insurance Brokersact for Clientswho are Policyholders. In doing so, they may claim under COB Rule 7.5.3(3) that they act 'independently' for the Clients.3. The DFSAexpects an Insurance Brokerwhich holds itself out to a Clientas acting 'independently' for the Clientto be able to demonstrate its independence to the DFSA. Factors that the DFSAwould take into account when assessing if an Insurance Brokerhas acted independently include whether that broker:(a) has assessed a sufficiently large number of insurance products available on the market, and those products are sufficiently diverse in terms of their types and the issuers, to be able to suit the Client'sneeds and objectives;(b) is free to select insurance products from a sufficiently large number of insurers — for example, if a broker has close links with insurers, or exclusivity clauses in arrangements with insurers whose products they can select, the broker may not be able to claim it is independent; and(c) has disclosed clearly to the Clientall commissions and other economic benefits it or a Group memberreceives from insurers with whom it places insurance.