Q&As

What sort of activities are caught by the insurance distribution regime—law firms?

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Published on LexisPSL on 11/10/2018

The following Practice Compliance Q&A provides comprehensive and up to date legal information covering:

  • What sort of activities are caught by the insurance distribution regime—law firms?
  • Introducing a client to a broker but then negotiating directly with the broker on the client's behalf to ascertain the right insurance policy
  • Commenting to the client on the terms of an insurance policy selected by a broker
  • Negotiating the terms of a pre-selected insurance policy direct with the insurer or via the broker

What sort of activities are caught by the insurance distribution regime—law firms?

The Insurance Distribution Directive (IDD), Directive 2016/97/EU defines insurance distribution as:

‘the activities of advising on, proposing, or carrying out other work preparatory to the conclusion of contracts of insurance, of concluding such contracts, or of assisting in the administration and performance of such contracts, in particular in the event of a claim, including the provision of information concerning one or more insurance contracts in accordance with criteria selected by customers through a website or other media and the compilation of an insurance product ranking list, including price and product comparison, or a discount on the price of an insurance contract, when the customer is able to directly or indirectly conclude an insurance contract using a website or other media.’

The Solicitors Regulation Authority (SRA) defines insurance distribution activities by reference to certain activities as specified in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO), SI 2001/544, which are carried on in relation to a contract of insurance or rights to or interests in a life policy. These activities are:

  1. dealing in investments as agent

  2. arranging (bringing about) deals in investments

  3. making arrangements with a view to transactions in investments

  4. assisting in the administration and performance of a contract of insurance

  5. advising on investments (except peer-to-peer agreements)

  6. agreeing

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