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.
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:
2.If you are an ‘insurance fulfilment provider’
You are an insurance fulfilment provider if you:
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.
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.
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