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{{propApi.successMessage}} {{region}} Change locationDo you do insurance work?
Members who carry out building work on behalf of insurance companies should be aware that insurance claims handling and settling services are now considered a financial service.
This might mean you are subject to new obligations.
Key facts
- If you undertake certain activities in relation to an insurance product you may be providing insurance claims handling and settling services. These services are now considered a financial service.
- If you are carrying out a financial service in some circumstances you may need to hold an Australian Financial Service (AFS) license.
When do I need an AFS license?
There are two circumstances that those in the residential building industry may need an AFS license.
1.If you are a ‘claimant intermediary’
You are a ‘claimant intermediary’ if you:
- carry on a business of representing insured people in pursuing a general insurance claim; and
- do so in return for any benefit (monetary or otherwise) which is given to you or a person you nominate.
2.If you are an ‘insurance fulfilment provider’
You are an insurance fulfilment provider if you:
- provide building services to satisfy an insures liability to an insured person; and
- have authority from the insurer to reject all or part of the claims.
Examples
A claiment intermediary
Steven’s roof is damaged in a hailstorm. John approaches Steven and says he will repair the roof and handle the insurance paperwork for Steven in exchange for a fee to be paid to a company controlled by another person.
John is a claimant intermediary as he carries on a business of representing a consumer to pursue an insurance claim for a benefit, even though the benefit is not provided directly to John.
A fulfilment provider
Sam operates a building business and is an approved repairer for an insurer. Sarah makes a claim on her home and contents policy. The insurer refers Sarah to Sam.
If Sam is authorised to reject all or part of Sarah’s claim, Sam will need an AFS license. If Sam is only authorised to accept Sarah’s claim, or has no authority to accept or reject Sarah’s claim, Sam does not need an AFS license.
ASIC has provided the below decision tree to assist members determine if they need an AFS license.
I need an AFS license, what should I do?
More information can be found at ASIC’s website where you can start your AFS licence application.To find out more, contact HIA's Workplace Services team
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