Avon InsuranceAvon Insurance

Insurance Brokers

Terms of Business Agreement


Avon Insurance Brokers is a general insurance intermediary registered to provide financial services in New Zealand by the Financial Markets Authority (FMA) as a Financial Services Provider under number FSP32784.


We are an independent intermediary and offer advisory services for your insurance requirements. We advise on a range of insurance products and we are not tied to any one insurer.


In the absence of an agreement to the contrary this documents sets out the terms upon which we provide insurance intermediary and risk management services to you. Your direction to bind coverage and/or your payment related to your insurance placement will be deemed your signed, written consent and agreement to be bound by the provisions of this document.


This document takes effect from 1 November 2013 or whenever it is received (whichever is the later) and supersedes any terms of business agreement that may have been previously sent to you by us.


In this document “we”, “us” and “our” means Avon Insurance Brokers.


Our Services:

We are committed to acting in your best interests at all times in providing services to you.


Negotiation and Placing:

We will discuss with you or your representatives your insurance requirements, including the scope of cover, the limits to be sought and cost. Upon receipt of your instructions, whether written or oral, we will endeavour to satisfy your requirements.


During the course of the placement of your insurance we will endeavour to keep you informed of the progress of our negotiations and identify any inability to obtain the coverage sought by you.


We will use reasonable endeavours to implement your insurance programme, subject to available insurers, before the intended date of inception, renewal or extension of your cover (whichever is appropriate).


We will provide you with information about the insurance cover to be recommended to you to enable you to decide whether to accept the insurance cover available. As your insurance intermediary, we will answer any questions you may have on the proposed cover, its benefits, placement, structure, restrictions, exclusions and conditions.


Market Security:

We assess the financial soundness of the proposed insurers and markets we recommend using public information, including that produced by recognised rating agencies. However, we will not in any circumstances act as an insurer nor will we guarantee or otherwise warrant the solvency of any insurer or market used for your requirements. As a consequence, the decision regarding the suitability of any insurer or market rests with you. If you have any concerns regarding any insurers you have chosen for your insurance requirements you must advise us as soon as possible and we will discuss them with you.


Servicing and Claims

Unless otherwise agreed, we will send you documentation confirming the basis of cover secured on your behalf, including details of insurer/s, with a debit note or premium billing, where applicable, showing separately all the amounts payable. The date upon which an amount is due together with any penalties for late payment will be clearly stated.


We will send you any policy documents, if applicable, and any amendments or endorsements to your policy as soon as reasonably practicable.


Except where we agree with you or, because market practice determines otherwise, we will provide our claims handling services during the policy period for the policies placed by us during the period of our appointment. These services can be continued beyond our appointment by mutual agreement, and may be subject to a separate fee. Our claims handling services include, upon receiving the required information from you, the notification of the claim or circumstances to insurers; advocating on your behalf in accordance with your instructions in the resolution of the claim and arranging the collection and/or settlement of the claim in accordance with market practice and your policy terms and conditions. Where claims are to be dealt with by you with insurers directly, we will provide advice and support as requested.


Further, our claims handling services will cease where we are satisfied that you have instructed another entity to assume the claims service obligations for your insurance.


Electronic Communications

We may communicate with each other and with other parties with whom we need to communicate in order to provide services to you, by electronic mail, sometimes attaching further electronic data. By agreeing for us to provide services to you, you agree to receive communications by email, including updated versions of this document.


By engaging in this method of communication we and you accept the inherent risks (including the security risks of interception of or unauthorised access to such communications, and the risks of corruption of such communications and the risks of viruses or other harmful devices). Notwithstanding that we have reasonable virus checking procedures on our system, you will be responsible for virus checking all electronic communications sent to you. You will also be responsible for checking that messages received are complete. In the event of a dispute neither of us will challenge the legal evidential standing of an electronic document and our system shall be deemed the definitive record of electronic communications and documentation.


You should also be aware that our system’s security devices block certain file extensions, including but not limited to: .rar, .vbs, .mpeg, .mp3, .cmd, .cpl, .wav, .exe, .bat, .scr, .mpq, .avi, .com, .pif, .wma, .mpa, .mpg. Emails attaching such files will not get through to us and no message will be sent to tell you that they have been blocked.

Your Responsibilities


Proposal Forms:

For certain classes of insurance you may be required to complete a proposal form, questionnaire or similar document. We will provide guidance but we are not able to complete the document for you.


Disclosure of Information:

You are responsible for providing us with the information required in order to meet your insurance needs. It is also your responsibility to provide us with any and all information which is material. We will not be responsible for any consequences which may arise from any delay or failure by you to do so. You remain responsible for any decisions you make.


An insured has a duty to disclose to the insurer, before the relevant contract of insurance is entered into, every matter that is known to the insured, being a matter that:

  1. The insured knows to be a matter relevant to the decision of the insurer whether to accept the risk and, if so, on what terms; or
  2. A reasonable person in the circumstances could be expected to know to be a matter so relevant.

In general, there is no duty on insurers to make enquiries of an insured. Failure to make such disclosure may allow an insurer to avoid or cancel the policy. This duty of disclosure applied equally at renewal of your insurance policies and on taking out new insurance cover.


Please discuss with us if you have any doubts about what is material or have any concerns that we may not be aware of material information.


Your Insurance Policy:

You are responsible for reviewing the evidence of insurance cover to confirm that it accurately reflects the cover, conditions, limits and other terms that you require. Particular attention should be paid to any policy conditions and warranties, as failure to comply may invalidate your coverage and the claims notification provisions. If there are any discrepancies, you should consult us immediately.


Further you should review the insurance premium payment terms provided to you. All premium payment terms must be met on time or your insurers may have the right to effect a notice of cancellation for non-payment of the premium. We shall also advise of any charges which are additional to the insurance premium.


We will send you any policy documents, if applicable, and any amendments or endorsements to your policy as soon as reasonably practicable.




You are responsible for notifying claims or potential circumstances that may give rise to a claim in accordance with the terms and conditions of your insurance contract. To ensure full protection under your policy or similar documentation you should immediately familiarise yourself with the coverage conditions or other procedures relating to claims and to the notification of those claims. Failure to adhere to the notification requirements, particularly timing, as set out in the policy or other coverage document, may entitle insurers to deny payment of your claim. In presenting a claim it is your responsibility to disclose all facts which are material to the claim. Claims may be made against certain policies long after they have expired. It is important, therefore, that you keep your policy documents in a secure place.


It is generally the case that claims may become unenforceable by way or legal proceedings (or in some jurisdictions, completely extinguished) if they are not pursued by legal proceedings commenced within the relevant limitation period applying to your claim in the jurisdiction in question. It is your responsibility to monitor the position on limitation periods applying to your claims and to commence legal proceedings in relation to your claims where this is necessary. It is also your responsibility to enter into “standstill” or “tolling” agreements in order to suspend the application relevant limitation periods, where this is desirable. We will not commence legal proceedings or enter into standstill/tolling agreements on your behalf, nor will we advise you if and when to do. On these issues we recommend you take your own legal advice.


Change in Circumstances:

You agree to advise us as soon as reasonably practicable of any changes in your circumstances that may affect the services to be provided by us or the cover provided under your insurance policy.


Provision of Information and Ownership:

All activities undertaken by us as outlined in this document are provided by us for your exclusive use and all data, recommendations, proposals, reports and other information provided by us in connection with our services are for your sole use. You agree not to permit access by any third party to this information without our express written permission.


While you retain ownership of all physical insurance contract documents, slips and any other documents created by us for you in the performance of the services (“Placing Documents”), subject to the duties of confidence set out in this document, ownership of all intellectual property rights in any Placing Documents vest in and remains with us. We grant you a non-exclusive, perpetual, royalty-free licence to use and reproduce the Placing Documents for your own internal business purposes subject to the provisos in this document.


We reserve the right to take action to protect proprietary information.


Payment of Premium:

You agree to provide settlement with cleared funds of all monies due in accordance with the payment date(s) specified on our debit note(s) or other relevant payment documentation (“Payment Date”). Failure to meet the Payment Date may lead to insurers cancelling your policy particularly where payment is a condition or warranty of a contract. We are under no obligation to pay premium by the Payment Date to insurers on your behalf.

Where permitted by applicable law we may have arrangements in place with certain carriers whereby your payment of premium to us is deemed to be a payment to the insurer. In the event that we have such arrangements agreed you should note that once we have received premium from you we will hold the premium for the insurer and we may not be able to return such monies to you without the express consent of the insurer even if you cancel your policy.


Our Remuneration

Avon Insurance Brokers will earn brokerage paid by insurers out of the premium payable to them on the placement of your insurance programme. There is no brokerage payable on any of the taxes or statutory charges that form part of the total due amount shown on your tax invoices, (usually referred to as Fire Service Levy, EQC and GST). These taxes and statutory charges are always shown separately on each tax invoice you receive from us, and are paid to the statutory authorities concerned either by Avon or via the insurers.


If you were introduced to Avon by a third party we may share some of our remuneration with that third party in recognition of the introduction and services they may provide to us in relation to your business. We confirm that the overall remuneration has not been increased to allow for such sharing.


The work undertaken comprises the following:


  • Negotiation with insurers for renewal of your insurance programme
  • Confirmation of placement of your insurance programme
  • Processing of premium invoices and payment of premiums, duties and levies in respect of insurance covers placed by Avon Insurance Brokers on your instructions
  • Negotiation of policy wordings for various classes of insurance
  • Assistance with negotiation and settlement of claims
  • Provision of insurance certificates of currency as/when required
  • Ongoing maintenance of the insurance programme, risk exposures, alterations to cover, policy limits and values
  • Issuing of policy documents from insurers

The following services or charges are not included in the remuneration outlined above and are subject to separate negotiation and agreement:


  • Reasonably reimbursement disbursements such as travel and accommodation
  • Premium Instalment Contracts
  • One-off projects (e.g. construction) or acquisitions

Limit of Liability

Our and/or our affiliates’ (together and separately “Avon”) aggregate liability for breach of contract, negligence, breach of statutory duty or other claim arising out of or in connection with this Agreement or the services provided hereunder shall be limited as follows to the extent permitted at law:

  1. in respect of personal injury or death caused by Avon’s negligence, no limit shall apply;
  2. in respect of any fraudulent acts (including theft or conversion) or wilful default by Avon, no limit shall apply;
  3. in respect of other claims, the total aggregate liability of Avon shall be limited to the sum of NZD $10 million; and
  4. subject to clauses (a) and (b) above, in respect of the following losses: loss of revenue; loss of opportunity; loss of reputation; loss of profits; loss of anticipated savings; increased costs of doing business; or any other indirect or consequential loss, Avon will have no liability in any circumstances.

Your direction to bind coverage and/or your payment related to your insurance placement will be deemed your signed, written agreement to be bound by the provisions of this section.


Other Revenue:

We provide services to insurers that are not directly related to the services provided to you and we receive usual and customary remuneration in recognition of those services.


This remuneration may be a management or administration fee or revenue based upon the profitability of insurance business placed with a given insurer over a specific period. These payments recognise the services we provide to the insurer over that given period.


If you were introduced to Avon by a third party we may share some of our remuneration with that third party in recognition of the introduction and services they may provide to us in relation to your business. We confirm that the overall remuneration has not been increased to allow for any such sharing.


Client Money:

We will treat any balances held by us for you in accordance with our practices and in accordance with our regulatory obligations. This means that client money will be held separately from our own money. Please note that your money may be transferred to another person or party (such as another insurance intermediary) where such transfer is required in order to carry out services to you.


We do not pay premium to underwriters on your behalf until we have received it from you, nor will we pay claim or other monies due to you before they have been received from underwriters (or other relevant third party). However, in the event that we make any payment on your behalf or make any payment to you prior to our being in receipt of relevant funds from either yourself, underwriters or other third party, we shall be entitled without prejudice to any other remedy available, to recover that amount by way of deducting that sum from any amount due to you, whether on the insurance upon which we have made payment to you or on your behalf, or on any other insurance we handle for you.


Data Projection and Confidentiality:

We will treat all information we hold about you as private and confidential, at all times. We will not disclose any information we hold about you to others except: (i) to the extent we are required to do so by law or a regulator; (ii) where it is necessary to do so in order to provide our services to you (which might involve us disclosing information which you consider confidential or sensitive to insurers); or (iii) at your request or with your consent. Under data projection law, you may have a right of access to some or all of the information we hold about you, or to have inaccurate information corrected. If you wish to exercise either of these rights, please contact us in writing.

You agree that we may (i) hold and process by computer or otherwise any information we hold about you in order to provide our services to you; (ii) hold and process such information for development and operational purposes; (iii) disclose to third parties certain anonymised or industry-wide statistics or other information which may include information relating to you; unless we have obtained your consent, information specific to you will not be revealed other than on an anonymised basis and as part of an industry or sector-wide comparison; and (iv) for the purposes of providing our services to you, for development or operational purposes, or for systems administration, transfer information we hold about you to any country – including countries outside the European Economic Area, which may not have comparable data protection laws.


Where you disclose personal data to us, including personal sensitive data, you will ensure that you obtain all necessary consents so that the personal data you provide to us can be lawfully used or disclosed by us in the manner and for the purposes anticipated by this Agreement.

We operate a paperless office system and/or hold documents on your behalf only in electronic or digitised format. In these circumstances, we may operate a policy of destroying hard copy documents that come into our possession for the purposes of providing our services to you.


Where this is the case, you recognise that we may only ever by able to provide you electronic or digitised versions of any document that we hold on your behalf.


You accept that to the extent that you wish us to destroy or expunge from our systems any electronic or digitised versions of documents held on your behalf, we will not be able to destroy such documents that have become incorporated onto our hard drives or any other system onto which data is stored only for the purposes of business continuity purposes or to comply with document retention requirements.


Ethical Business Practice:

We do not tolerate unethical behaviour either in our own activities or in those with whom we seek to do business. We will comply with all applicable laws, rules, regulations and accounting standards.


Conflicts of Interest:

Circumstances may arise where we may find we have a conflict of interest or otherwise have a material interest in or related to a matter in respect of which we are acting. For example, we may be asked to act on behalf of an insurer in the appointment of a loss adjuster; or, we may find that the interests of two of the clients for whom we act conflict.


We have conflict management procedures and we seek to avoid conflicts of interest but where a conflict is unavoidable we will explain the position fully and manage the situation in such a way as to avoid prejudice to any party.


The insurance market is complex and there could be other relationships not described here which might create conflicts of interest. Whatever the circumstances, we will act in your best interests; and, if a conflict arises for which there is no practicable solution, we will withdraw unless you wish us to continue to act for you and provide us with your written consent to that effect.



Should you have any cause for complaint about our services please raise the matter in the first instance with the person who handles your account. Alternatively, you may contact our director, Allan Daly, at Avon Insurance Brokers.


If a complaint cannot be dealt with immediately (within 24 hours of receipt) we will acknowledge your complaint within five days of receipt and will advise you of the person dealing with it.


Should you not be happy with the response to your complaint you have the right to take your complaint to: Financial Services Complaints Service Limited, PO Box 5967, Lambton Quay, Wellington 6145; www.fscl.org.nz.



Our services may be terminated either by us or you upon the giving of one month’s notice in writing to the other or as otherwise agreed.


In the event our services are terminated by your we will be entitled to receive any and all fees or brokerage payable in accordance with the terms of “Our Remuneration” set out above. In the event that such remuneration has not been received by us in full at the time notice of termination becomes effective, you agree to pay to us any outstanding amount within 7 days of the effective termination date and thereafter on demand.



You agree that we have a right to amend this document by sending you either a notice of amendment in writing or a revised Terms of Business Agreement. Any amendment will apply in respect of any service transaction entered into by us after notice of the amendment is given, and may take effect either immediately or at such later date as the notice may specify. We will however give you at least ten business days’ notice of any change.



Anti-Money Laundering:

To comply with applicable anti-money laundering regulations there are times when we may ask clients to confirm (or reconfirm) their identity. We may need to do this at the time you become a client or have been one for some time or for example, when checking details on proposal forms and transferring claims payments. This information may be shared where we deem necessary with regulatory or law enforcement bodies. Please note that we are prohibited from disclosing to you any report we may make based on knowledge or suspicion of money laundering, including the fact that such a report has been made.


Third Party Rights:

Unless otherwise agreed between us in writing, and to the extent permitted by applicable law, no term of this Agreement is enforceable by a third party.


Governing Law:

This Agreement, which sets out the terms of our relationship with you, will be governed by and construed in accordance with the laws of New Zealand and any dispute arising under it shall be subject to the exclusive jurisdiction of the New Zealand Court.

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