News

Insurance and retirement funds brokers operating in the country will now be governed by a Code of Conduct. This is contained in the Insurance Directives (Amendment) Notice of 2010, which came into effect on July 1, 2010. The notice has to be read as one with the Insurance Directives of 2008. "This directive sets out the Code of Conduct for insurance brokers offering insurance services and advice to members of the public in Swaziland. It replaces form RDI 14 of the Insurance Directives of 2008," the gazette says. It says members of the public seeking insurance advice not only rely on insurance advisors’ expertise but also expect a high standard of professionalism and integrity from an advisor.

"In order to support these standards, advisors must uphold the Code of Conduct in all their relationships with members of the public, other advisors, employees as well as insurers and any other parties supplying a service to the public," it reads in part. In terms of competency, the Code of Conduct says a broker is obliged to maintain a high level of professional knowledge and skill in order to advise clients in accordance with all relevant laws as well as appropriate technical and professional practice and standards.  "A broker will only provide advice in those areas and subjects in respect of which the broker is technically and professionally qualified unless advice and assistance is obtained from a competent practitioner in those areas," it says.

It says a broker’s duty to the client is to provide competent guidance based on sufficient knowledge of the client’s needs, specific risks entailed and adequate consideration of the relevant insurance principles in a skillful and expert manner. The public regards registration as an insurance broker an indication of competence, the Code continues. It says; "Competence is not limited to the legal qualification as an insurance broker. It is also the broker’s ability to competently provide the services needed by the client. It calls for a clear understanding of insurance principles, and it requires sound knowledge of practices and procedures to apply them effectively in the best interest of the client."

A registered insurance broker should be knowledgeable, skilled and capable of performing as an insurance intermediary. "The client is entitled to assume that the broker has the ability and capacity to deal adequately with insurance matters on the client’s behalf. A broker should not undertake to arrange insurance without being satisfied that they are competent to handle the arrangements without causing the client unnecessary delay, risk or expense. This becomes an ethical question relating to transparent, just and fair dealings with the client and is important since an incompetent broker can impair the credibility and perception of the industry," the Code explains.

It says a broker should therefore act honestly and fairly, with due skill, care and diligence, in the interest of clients and the integrity of the insurance industry. The Code continues to say that in all dealings with the public, a broker will act with integrity, professionalism and utmost good faith. "A broker will apply knowledge and skill to provide a client with those products and services which will best fulfill that client’s particular needs, with specific reference to: the client’s financial circumstances; the client’s existing coverage; the client’s ability to afford the product or service concerned; and the client’s objectives in relation to the insurance service required," it says.

Adding, the Code says should any product or service be marketed to the client, the advantages as well as limitations of the relevant product or service must be explained to the client; "So that the client can make an informed decision regarding the product or service". The client’s needs must be determined by means of a thorough analysis of the client’s relevant affairs, it says.