Before concluding an insurance contract, many businesses or individuals seek a close relationship with an intermediary who can advise them on the best product at the most advantageous price and assist them during the contract. Our legal expert takes a closer look at this contractual relationship. What is the responsibility of the insurance broker?
Definition of Insurance Broker Responsibility
An insurance broker is an intermediary in insurance or reinsurance who connects insurance policyholders with insurance companies or reinsurance companies, without being bound by them.
To operate in Belgium, the broker must be registered in the insurance intermediaries register and have the required professional knowledge.
Furthermore, they must have sufficient professional integrity, adhere to an extrajudicial complaint handling system, and take out professional liability insurance.
Obligations
The broker has a duty of information and advice towards their client.
In order to provide useful advice to their client, the broker must gather information from them and particularly understand their requirements and needs.
They must also ask any useful questions of their client regarding the subscription to an insurance policy.
A broker commits a fault if they merely propose to their clients the subscription to an insurance policy with an unknown company, without drawing their client’s attention to the risks and pitfalls of this coverage.
Conversely, the broker will not be liable, for example, for not drawing their client’s attention to certain clauses when they are clear and intelligible.
The broker also has a duty of advice towards their client.
The broker’s duty of advice consists of guiding the client in the choice of one policy over another, with one company or another, after providing the client with all necessary information and conducting a comparison of the costs and merits of each policy considered.
For example, in the context of a “life” product, the broker is only responsible if the investment were to necessarily lead to heavy losses, regardless of economic circumstances.
In any case, the broker can never be held responsible for intentionally inaccurate statements made by the policyholder when subscribing to the contract.
Responsibility
It is generally considered that the information and advice duties of the broker constitute obligations of means and not obligations of results, which will have an impact on the burden of proof.
In case of dispute, it will be up to the insured who believes they have been poorly informed and/or advised by their broker to demonstrate the fault of the latter but also to establish that they have suffered damage and especially that there is a causal link between the breach and the damage.
It is up to you, therefore, to demonstrate that your choice would have been different if you had been properly informed by your broker.
