Terms of Business

This terms of business agreement (TOBA) sets out the basis on which Native Broking Limited agrees to provide services to you, whether as a direct client or as an intermediary or insurance undertaking. You should read this document carefully, because as well as setting out the terms of our relationship with you it contains details of our regulatory and statutory responsibilities. It also identifies your own responsibilities both to us and insurers. These are our standard terms and cannot be varied without our written consent we therefore ask that you read this document carefully, contacting us immediately if there is anything in this document which you do not agree with or do not understand otherwise we will assume that you are in agreement with them.

IN THESE TERMS OF BUSINESS

• Native Broking Limited is also referred to as “Native”, “we”, “us”, “our”, or “ourselves”
• Insurance/insurer/insured should be construed within this TOBA to include reference to reinsurance /reinsurer/ reinsured.

1. WHO ARE WE

1.1 Native Broking Limited a private limited company registered in England and Wales under Company Number 15917853 at registered office address, 24 Lime Street, London, EC3M 7H. Native, Firm Reference Number 1018862 is an appointed representative of Bluefriars Brokers Limited which is authorised and regulated by the Financial Conduct Authority under Firm Reference Number 604987 registered at Lloyd’s under CSN: BFB1605.

2. RELATIONSHIPS

2.1 If you are an intermediary or an insurance undertaking, you will be a “commercial customer” as defined in the FCA regulations. In all cases, you must ensure that by instructing us you are warranting that you have the Authority to do so on behalf of your clients. It is also both our obligations to ensure that we hold and comply with all necessary licenses, statutory legal and regulatory rules that apply in our local domicile including the retention of records and reproduction of such, if required, on a timely basis.

2.2 If you are a direct insured this document sets out the basis on which we will provide you with services in relation to each contract of insurance that we place on your behalf, taking into consideration your demands and needs, complying at all times with all necessary licenses, statutory legal and regulatory rules.

3. OUR SERVICES TO YOU

3.1 We will act as intermediary for you and provide independent insurance intermediation/broking and other insurance distribution and consultancy services to you with reasonable skill and care. We are also subject to the law of agency, which imposes various additional duties upon us.

3.2 In the absence of an agreement to the contrary this document sets out the terms upon which we provide insurance intermediation and risk management services to you, Your direction to bind cover and/or your payment of premium will be deemed with your signed written consent and agreement to be bound by the terms of this agreement.

3.3 We will arrange insurance with insurers to match as far as possible, your insurance or reinsurance demands and needs, or if you are an intermediary the demands and needs of your client, issue policy documentation to you in a timely manner to provide you with contract certainty, assist in any on- going changes and assist when and if you need to make a claim against the policy.

3.4 We will advise according to our knowledge and market experience on insurers available to meet your demands and needs which may be: a single insurer;

• a group of subscribing insurers acting on a co-insurance basis;
• through “lineslip” facilities whereby cover may be bound by one or more insurers on behalf of a number of others;
• as a “coverholder” which is where we have delegated authority from insurers to bind certain classes of insurance on their behalf under a facility know as a binding authority; and
• by instructing another localized or specialist sub-broker to assist in arranging or administering an insurance contract.

In these circumstances we may also act for and owe duties of care to other parties.

3.5 We do not offer or provide advice in relation to tax, accounting, regulatory, legal or other specialist matters(including in relation to sanctions or in relation to obligations you may have where the insurance policy you receive is subject to a law other than that of England and Wales) and you should take separate advice as you consider necessary regarding such matters.

3.6 You agree that in providing our services to you that we may use electronic placing, electronic servicing and electronic claims handling services of third parties, and if you we do so we will be acting for you and, if you are an intermediary for your client as agent so that in doing so you and, if you are an intermediary, your client will be bound in accordance with the arrangements we have in place from time to time to access those electronic platforms.

4. CONFLICT OF INTEREST

4.1 In the performance of our services, situations may arise where we have conflicting interests, if this should occur, we have procedures, systems, and controls in place to deal with it.

For example, we may act as agent for two or more clients involved in the same or related loss situation, where this occurs, we will advise the clients involved and take steps as soon as reasonably practical to segregate the claim servicing functions provided to each of the involved clients.

4.2 Circumstances may arise where we have a conflict of interest between us (including our managers, employees or agents) or our parent company and you, or between you and another of our clients. We always aim to treat you fairly and avoid conflicts of interest. We never deliberately put ourselves in a position where our interests, or our duty to another party, prevent us from discharging our duty to you.

4.4 We may act as agent of an insurer under a delegated underwriting authority and/or delegated claims settlement authority. In these instances, where we act as your agent for your insurance needs we will always act in your best interests when arranging your policy.

4.5 Should a situation arise where our own interest’s conflict with any duty we owe to you our Conflicts of Interest Policy is designed to help us recognize and manage such circumstances and we will not proceed until such time as you have been fully appraised of the position and you have given your informed consent. We recognise that in situations of conflicts of interest, you may wish to secure the services of another intermediary to assist you with matters. Your interest will be in the forefront always.

4.6 We follow our own conflict management policies and procedures (for example, using information barriers). These are designed to prevent any conflicts of interest from adversely affecting or compromising your interests. However, in some cases, where we cannot be reasonably confident that we can prevent the risk of damage to your interests, we will discuss this with you and gain your agreement before proceeding. If you have any concerns in relation to conflicts of interests, please contact us.

5. MARKET SECURITY

5.1 We will identify clearly and seek your consent for the use of any market security prior to placing cover. Our selection of insurers is based generally on our experience and knowledge of the market and the use of recognised rating agencies such as Standard & Poor’s, A. M. Best and Moody’s, the information of which is in the public domain which we recommend you using. You should advise us immediately if you have any concerns about the use of security selected.

5.2 In rare circumstances we may ask you for specific approval of the proposed security.

5.3 We cannot and do not guarantee or accept any responsibility for the financial standing or financial performance, including solvency or continuing solvency of any insurer used.

5.4 You should also note that the financial position of an insurer may change after cover is placed with them which could result in them not meeting their obligations to you in respect of claims or return premiums.

6. DUTY TO DISCLOSE

6.1 Under the laws of England and Wales, Scotland and Northern Ireland (UK law):

• a business insured (i.e. an insured who has bought insurance wholly or mainly for purposes related to their trade, business or profession) has a duty to disclose to the insurer every material circumstance which it knows or ought to know after reasonable search.
• a consumer, (i.e., an individual buying insurance wholly or mainly for purposes unrelated to your trade, or business profession), and subject to UK law, you have a duty to take reasonable care to answer the insurer’s questions fully and accurately and to ensure that any information that you volunteer is not misleading.

If you are an intermediary it is the duty of your client and you as their agent, to make fair presentation of the risk to be insured. If you are a direct client please note the contents of part 6.

6.2 This duty exists before cover is placed, when it is renewed and any time that it is varied. The policy wording may also provide that this duty continues for the duration of the policy period.

6.3 A circumstance is material if it would influence an insurer’s judgment in determining whether to take the risk and, if so, on what terms. If there is any doubt whether a circumstance is material, we would recommend that it should be disclosed.

6.4 Failure to disclose a material circumstance may entitle an insurer to impose different terms on the cover or proportionately reduce the amount of any claim payable. In some circumstances an insurer will be entitled to avoid the policy from inception and in this event any claims under the policy would not be paid.

6.5 The disclosure requirements, and consequences may differ where a contract is governed by laws of another jurisdiction, in these circumstances it is important whether you are a direct client or you are an intermediary to ensure that your client has disclosed to the insurer all material information concerning the subject of insurance.

7. THE INSURANCE ACT 2015 - Contracting out

7.1 This clause 7 only applies to insurance policies which are subject to the laws of England and Wales, Scotland, and Northern Ireland.

7.2 The UK Insurance Act 2015 allows non-consumer insureds and insurers to contract out of certain provisions of that Act in a policy of insurance for a non-consumer insured. However, any “disadvantageous terms” (something that puts an insured in a worse position than the default regime under the UK Insurance Act 2015) must meet certain transparency requirements.

7.3 We will not provide advice in respect of any proposed contracting out of the Act unless specifically instructed by you and we then agree to do so.

8. QUOTING AND PLACING and CONFIRMATION OF COVER

8.1 We will seek to understand your requirements and keep you fully informed of progress at all stages of negotiations providing you with details of the terms indicated by insurers, including an indication of the likely premium cost. It is vital that you provide us with all relevant information and that you keep us informed of changes in material circumstances to enable us to properly represent your interests.

8.2 We will promptly advise you by e mail, or other agreed means of communication, of the completion of the insurance arrangement(s). This will be in the form of one or more of the following: a Native produced Evidence of Cover document, an insurance policy, a certificate of insurance, or a copy of the Market Reform Contract (the placing slip). It will confirm the basis of the cover, setting out the terms of the insurance and the names of the insurers with whom it has been placed and their respective signed lines.

8.3 You should familiarise yourself with all terms of any insurance that you purchase. In particular you should treat all warranties seriously and strictly comply with them. Failure to do so may entitle the insurer to decline a claim under your insurance. Likewise, if the insurance policy has a subjectivity, condition, and/or a condition precedent and it is not complied with then your insurance may be invalidated.

8.4 If you are an intermediary or a client with an insurance undertaking, we will confirm the basis of cover to you in the same format as stated above. We assume that you, as an insurance professional, understand the terms, scope, and effect of the insurance contract unless you inform us to the contrary. It is your responsibility to ensure that the ultimate insured, your client, is aware of all the terms of any insurance policy obtained by us on your instructions. It is particularly important that you understand and explain to your client the obligations imposed by terms expressed as subjectivities, conditions precedent, warranties or similar terms (see 7.3).

8.5 If you are a Retail Client (a client who is not a professional or an eligible counter party) a statement of demands and needs will be attached to the contract documentation. It will confirm whether the policy has been personally recommended and if so, the reasons for this. Before expiry of the policy (within no less than 21 days) you will be provided with renewal terms for reference purposes, or notified that renewal is not being invited. Please also pay particular attention to 7.3.

8.6 You should check the documents sent to you carefully, to ensure that they are entirely in accordance with your understanding and instructions. Should this not be the case, or if you require any clarification of the content, or if you are dissatisfied with the insurance security, you should contact us immediately.

8.7 For some types of insurance cover, it is possible that a claim may be made under a policy long after its expiry date. Retention of documents is therefore important and essential and kept safely by you. It is our practice to retain documents for business that we place on your behalf in electronic format in line with market practice and/or regulatory requirements.

9. FINANCIAL / ECONOMIC CRIME / KNOW YOUR CLIENT

We are committed to the fight against financial crime, and we are obliged to comply with UK legislation and FCA regulations.

9.1 Bribery and Corruption

Native has in place strict policies regarding bribery and corruption in compliance with applicable regulatory requirements, rules, laws including the UK Bribery Act 2010. It is integral to our relationship with you that when you are doing business with us you (and any of your agents) have similar policies and procedures in place to ensure that acts of bribery or corruption do not take place. Any breach of bribery laws by any party with whom we transact business, either directly or indirectly, will entitle us to treat our Agreement as immediately terminated.

9.2 Money Laundering

9.2.1 UK regulation requires that we obtain certain information and evidence to confirm, or reconfirm your indemnity, address, registered address, company registration, certificate of incorporation, Parent company details, list of directors, shareholders, and beneficial owners. At the start of, or during, our business relationship. This due diligence process is commonly known as “Know your Customer” (“KYC”). If we cannot source this information electronically, we will request the necessary information from you.

9.2.2 We will seek further information if a request is made for a payment to be made to a third party.

9.3 Sanctions

9.3.1 We are legally obliged and will comply with all sanction regimes and legislation which affect us or our parent company. Regular screening activities will be undertaken to confirm that we are not providing financial services or financial resources to sanctioned individuals.

9.3.2 Where obliged by applicable sanction regimes we may have to take certain actions, which include but is not limited to, the freezing of funds held on behalf of parties and individuals caught under applicable sanctions, or the discontinuation of coverage under an insurance policy.

9.4 General

If you are an Intermediary or an insurance undertaking you are required to have appropriate policies and prevention procedures in place to ensure that no acts of bribery or corruption, money laundering or tax evasion and fraud take place. You agree to carry appropriate due diligence, related to financial crime legislation upon your own clients.

10. PAYMENT OF PREMIUM DEBIT/CREDIT NOTES

10.1 A Debit Note will be sent to you which, in addition to any taxes or charges, will clearly show the total amount of premium due. We do not accept responsibility for accounting for taxes or for other similar charges unless we have a legal duty imposed in a specific jurisdiction or we have formally agreed to do so in advance.

10.2 Premium should be submitted to Native in cleared funds in sufficient time to enable us to honour the payment terms to the insurers. If you do not think that you will be able to comply with any premium payment condition and/or warranty please contact us immediately. Failure to pay on time may lead to the cancellation and/or suspension of the insurance.

10.3 Payment must be in the currency shown on the Debit Note. If you should pay in a different currency the converted funds will be applied against the amount due with any shortfall arising from the exchange differences remaining your liability.

10.4 A Credit Note will be issued where there are return premiums due to you. You should not set Debit Notes and Credit Notes against each other. This is only permissible with prior written agreement, which may be by way of statement of accounts.

10.5 Certain accounting arrangements in the London insurance market can give rise to an automatic deduction of premiums from our broker account and, if that occurs at a time when you have not paid the premium to us, you agree to settle that amount to us without delay.

10.6 Our method of payment is by direct transfer to our client money bank account together with a remittance advice. We will advise you our banking details and you are not to accept any changes to these details unless we notify them to you in writing in the form of our statement of account.

10.7 We will not accept payment from a third party (i.e. they have not been remitted to us by you) and we have not agreed to this in advance, having satisfied our anti-financial crime due diligence requirements.

11. THE RECEIVING AND HOLDING OF CLIENT MONEY

11.1 Client money is money of any currency that we receive from you or from an agent for you and claims and return premiums received from insurers.

11.2 In some cases, funds we receive may be held by us as agent for the insurer, depending on the terms of business in place at the time between the relevant insurer and us (a risk transfer agreement)

11.3 We will hold and co-mingle all premiums, claims money and return premium in bank accounts held in designated client money accounts.

11.4 We are allowed to hold separately permitted designated investments with a value at least equivalent to the money that would otherwise have been paid into our non - statutory trust bank account. If we do this we will be liable for any resultant shortfall in your money held by us.

11.5 We may hold Client Money in accounts in other currencies. Whilst we may choose to bear reasonable currency exchange losses, we reserve the right to recover from you any loss, relating to exchange differences or otherwise arising from payments made in currency different to that stated in the documentation provided to you by us.

11.6 Client monies will be deposited with banks which have been approved by the relevant regulator. We may transfer your money to other banks or intermediaries, including those where the legal and regulatory regime will be different. We will not be liable to you for any loss resulting from the failure of any bank holding client money to meet its obligations as a result of insolvency or similar default.

11.7 Any interest earned on Client Money held by us and any investment returns will be retained by us for our own use.

11.8 If you are an intermediary you warrant that you hold client money in compliance with the regulatory regime and laws that apply to you in your jurisdiction.

12. REMUNERATION AND OTHER INCOME

12.1 For the services that we carry out on your behalf our remuneration is normally by way of brokerage/commission which is determined by insurers with whom we place your business.

12.2 You may separately agree to remunerate us by way of a fee for placing and administering the insurance and/or providing claims and other services. Where we are to be remunerated by a fee these business terms will still apply but in addition we will negotiate and agree the fee with you and you will be responsible for payment of the fee. In some circumstances remuneration will be by way of a combination of both commission and a fee, which will also be discussed and agreed with you in writing prior to the conclusion of the placement of your insurance.

12.3 In addition to the above you should also be aware that Native may receive fees or additional commissions from arranging your insurance from the following sources;

• Interest earned on the insurance monies passing through our client money bank accounts.
• Expense allowances or commissions from insurers with whom we have placed your insurances, for certain financial management, business processing, policy administration and other services which we provide directly to insurers. These are supplementary to services we furnish to you.
• Profit commissions paid by insurers on specific facilities and arrangements for a limited class of business. These are usually at the end of their accounting period and in recognition for the additional work that may have been carried out by us.
• Income derived from arranging premium finance
• We may have arranged or be requested to arrange facultative or treaty reinsurances for the insurers for whom we effect your insurance.

12.4 All fees or commissions are deemed to be earned at the placement of the of the policy. (i.e. when final signed policy documentation has been provided to you.)

13. CLAIMS

13.1 It is very important that you carefully read the terms and conditions paying particular attention to notification of claims under the insurance contract that we have placed on your or your client’s behalf, as requirements can vary substantially from policy to policy. If you are an intermediary, you should point the details out to your client.

13.2 All material information concerning a claim or potential claim mut be provided within any specified time frame included in the policy. Failure to do so may entitle insurers to deny liability for the claim.

13.3 We will promptly inform you of the acceptance or denial of a claim, and in the case of any denial of a claim we will pass on to you the insurers reasons for the denial. We will not pay a claim to you, or to an intermediary if one is involved, until such time as we have received payment from insurers.

13.4 We will continue to provide a claims broking service for you as long as you remain a client of Native. If you cease to be our client but request us to continue to service any claims for you thereafter, we reserve the right to charge a fee.

14. COMPLAINTS

14.1 We take any complaints very seriously and we will ensure that complaints are handled fairly, effectively and promptly and are resolved at the earliest opportunity. We have a formal complaints policy in line with regulatory and statutory requirements. All complaints Should be in writing and addressed specifically to:

The Compliance Officer Suncrest, Throcking Lane, Buntingford, Hertfordshire, SG9 9RP (by e-mail to [email protected])

14.2 If your insurance policy has been underwritten by underwriters at Lloyd’s and you are unhappy with our response you may be entitled to refer the matter to the complaints team at Lloyd’s. They will investigate the matter and provide a final response. Full details of Lloyd’s complaint procedures are available at www.lloyds.com/complaints.

14.3 In the unlikely event that we are unable to satisfactorily resolve your complaint you may be entitled to refer it to the Financial Ombudsman Service (FOS). This is an independent service in the UK for settling disputes, further information on the FOS and whether you are eligible to refer your complaint to them can be found by calling on 0800 023 4567, or alternatively by e-mail at www.financial-ombudsman.org.uk

15. DATA PROTECTION AND SECURITY OF INFORMATION

15.1 We are registered with the Information Commissions Office (ICO) under the UK General Data Protection Regulation in all our dealings with your personal data.

15.2 Your personal information will be kept secure. We undertake to ensure your personal data is:

• processed lawfully, fairly and in a transparent manner and disclosed only to those entitled and in the course of carrying out your instructions as your insurance broker or consultant except as may be required by law or regulatory authority;
• adequate, relevant and limited to what is necessary in relation to the purposes for which it is processed;
• kept in a form which permits identification of data subjects for no longer than is necessary for the purposes for which the personal data is processed;
• processed in a manner that ensures appropriate security of the personal data including protection against unauthorised or unlawful processing and against accidental loss, destruction or damage, using appropriate technical or organizational measures.

15.3 The above will not apply to data that is in the public domain or we receive from an alternative source.

15.4 As part of our day-to-day communications with you, we will generally use e-mail and unless you advise us to the contrary in writing then you accept this is a valid communication enforceable as written communication for legal and regulatory purposes.

16. LIMITATION OF LIABILITY

16.1 All services are provided to you or your affiliates, under this agreement, including any additional services whether expressed or implied, by Native acting through its directors and employees. No director or employee will owe you any personal duty of care.

16.2 We will not be liable for any direct or indirect losses, damages, costs or expenses resulting from the services that we provide or any failure to provide services unless arising directly from our negligence, willful default or fraud (or that of our directors, officers or employees).

16.3 If we are liable in circumstances where you have incurred a loss which is caused partly by us and partly by contributory actions or omissions by you or others acting for you, then our total combined liability to you will not exceed our proportionate responsibility for the loss having regard to the proportionate responsibility for the loss of you and others acting for you, as agreed, or if not agreed as decided by a court or tribunal.

16.4 Without prejudice to any other provisions of this Limitation of Liability clause, if you suffer or incur losses, damages, costs or expenses as a result of or in connection with the service that we provide or any failure to provide services otherwise than as a result of our willful default or fraud, then our total liability for such losses shall not exceed a sum equal to £1,000,000.

17. INTELLECTUAL PROPERTY

We shall retain all title, copyright, patents and other intellectual property rights to all methodologies and documents used in our provision of the services to you.

18. AUTHORITY TO GIVE INSTRUCTIONS

The assumption will be that all your employees, directors and officers who give us instructions are authorised to do so unless instructed otherwise.

19. FORCE MAJEURE

We shall not be liable to you if we are unable to perform services because of any cause beyond our reasonable control. In the event of any such occurrence affecting us we shall notify you as soon as reasonably practical.

20. GOVERNING LAW AND JURISDICTION

This Agreement will be governed by, and construed in accordance with English and wales law and the parties irrevocably submit to the exclusive jurisdiction of the courts of England and Wales.

21. RIGHTS OF THIRD PARTIES

These terms of business are not intended to nor do they confer a benefit or remedy on any third party, whether by virtue of the UK Contracts (Rights of Third Parties) Act 1999 or otherwise. Further we may rescind or vary these terms of business as they apply to you, whether in the whole or in part without the consent of any third party.

22. SEVERABILITY

In the event any portion of this Agreement is found to be invalid or unenforceable in whole or part, the remainder shall remain in force and effect. A failure at any time by us to enforce any right or obligation shall not be deemed to be a continuing waiver of such right or obligation.

23. TERMINATION AND AMENDMENTS

23.1 This TOBA for us to act as your agent may be cancelled by either of us at any time by giving at least 30 days’ notice in writing.

23.2 In the event of cancellation, we shall be entitled to receive any and all brokerage commission or fees in full in respect of any insurance contracts we had placed on your behalf prior to the date of written termination of our authority to act on your behalf.

23.3 No variation of this TOBA shall be effective unless in writing. You agree that to amend these terms of business we will either send you a notice of amendment in writing by e- mail or a revised TOBA.