Financial Services Guide
We have pleasure in providing you with our Financial Services Guide (FSG).
This Financial Services Guide (FSG) is designed to assist you in deciding whether to use the services offered by us.
It contains important information about:
- who we are;
- the services we can provide you;
- how we and our representatives are remunerated; and
- our internal and external dispute resolution procedures and how you can access them.
It is important that you read this FSG in its entirety and retain it for your future reference. By engaging, or continuing to engage us you are, in the absence of any formal written agreement with us, agreeing to the delivery of our services and remuneration as described in this FSG.
If this FSG is provided to you by one of our Authorised Representatives, you will also receive the relevant Authorised Representative Schedule. The FSG and schedule should be read together.
Statements of Advice and Product Disclosure Statements
If we provide you with personal advice or recommend an insurance policy, we will, where required, give you a Statement of Advice (SOA) or a record of our advice and a Product Disclosure Statement (PDS).
A SOA will explain our advice, including the basis for our advice and the information we have relied on. It also includes details about how we are paid and any relevant relationships or associations we may have which may have influenced the advice we have given.
A PDS is produced by the insurer and is designed to give you important information on the features, benefits and risks of the policy to assist you in making an informed decision about whether to buy the product or not.
You should read these important documents before acting on any advice we have given you.
If you have supplied your email address to us, we will send insurance documents including this FSG, SOAs and PDS (if required) to that address unless you instruct us that you wish to receive those documents in a different form (e.g. hard copy by post).
Who we are
We are a group of Australian companies that provide general insurance broking services. Our services may be provided to you by one or more of the following companies in our group or an Authorised Representative of one of those companies who are collectively referred to in this FSG as ‘we’, ‘us’, ‘our’ or ‘Gallagher’:
- Arthur J. Gallagher & Co (Aus) Limited (ABN 34 005 543 920) Australian Financial Services License (AFSL) No. 238312; and
- Milne Alexander Pty Ltd (ABN 12 089 060 524) AFSL No. 277932.
Gallagher has registered the business name “Insurance Markets and Rewards (imar)” and you may see this name on documentation that we provide to you. Our contact details are at the end of this FSG.
If an Authorised Representative is your broker, their details will appear in the Authorised Representative Schedule.
We are part of a group of international companies owned by Arthur J. Gallagher & Co (Gallagher Group). The Gallagher Group is one of the world’s leading providers of insurance broking, risk management, and consulting services. The parent company, Arthur J. Gallagher & Co., was founded in the United States in 1927 and is listed on the New York Stock Exchange.
In Australia, the Gallagher Group also includes related service providers such as:
- Elantis Premium Funding Limited trading as Monument Premium Funding ABN 20 002 543 606 (Monument), which provides premium funding and other credit services.
- MA Underwriting Pty Ltd ABN 29 138 182 288 (MA Underwriting) which binds insurance products under a Corporate Authorised Representative arrangement with a local insurer (Representative number 435171)
- Pen Underwriting Pty Ltd ABN 89 113 929 516, AFSL 290518 and Pen Underwriting Group Pty Ltd ABN 80 082 459 372, AFSL 238170 (Pen), Australian underwriting agencies providing access to both the Lloyd’s market and local insurers.
For further information about our related entities please visit: www.ajg.com.au/arthur-j-gallagher-co.
We have an extensive national broking network in metropolitan and regional Australian locations providing broking solutions to a wide range of clients from small to medium enterprises through to large multinational corporations, as well as affinity partners and associations.
We aim to deliver on our aspiration ‘to position you to financially survive any insurable event’ through:
- maintaining local relationships with our clients;
- leveraging our national and trans-Tasman influence with insurance companies to negotiate better deals and more coverage options;
- providing you with 24/7 support and the experience of our dedicated national claims team; and
- making the most of our global capability of industry-specific experts and offshore markets for your benefit.
Gallagher holds an Australian Financial Services Licence under the Corporation Act which authorises us to deal in (including to issue and arrange for others to deal in), and provide personal and general advice concerning general insurance products.
We are committed to providing sound advice based on our market knowledge including:
- investigating and analysing your insurance needs;
- providing information or advice about insurance solutions that may be appropriate for you;
- arranging, varying and renewing your insurance policies;
- helping you deal with your insurer in the event of a claim; and
- providing other risk management services.
Our relationship with you
As general insurance brokers, we normally act as your agent when dealing with insurers. When you do business with us, you will usually deal with our employees, however you may also deal with one of our “Authorised Representatives” or “Distributors”.
Authorised Representatives are third parties whom we have authorised to provide financial services on our behalf. When you are dealing with one of our Authorised Representatives in relation to a retail product, you will also receive an Authorised Representative Schedule which forms part of this FSG. This schedule will contain Company details, information about the Authorised Representative’s industry experience, and services they are authorised to provide.
Distributors are third parties who we have authorised to deal in specific insurance products on our behalf. They can only provide factual information and are not authorised to provide any advice.
Our Authorised Representatives and Distributors are not employees.
Acting for Insurers
In some circumstances we may have an agreement with an Insurer to act as their agent. This may be under a binder arrangement which allows us to offer, vary or cancel policies and manage claims on their behalf without reference to them, provided it is within the authority they have given us.
If we are given a “Binding authority” from an Insurer, it means we are acting in the interest of the Insurer and we are not acting on your behalf and you will need to determine the appropriateness of the insurance cover to your needs. We will clearly advise you when we act for an Insurer and not for you.
When we provide you with advice this may be general advice or personal advice.
If we provide you with general advice we will give a general recommendation or opinion about a product which is not based on a detailed consideration of your individual needs, objectives or financial situation. When giving general advice, we will give a warning that you should read the relevant PDS and policy wording in full and consider whether the insurance product in question is appropriate for your circumstances.
If we provide you with personal advice, we will review and consider your individual circumstances before providing our advice. We may also provide you with a PDS and/or a SOA (if required). You should read these documents carefully before acting on our advice.
If we provide you with personal advice and we do not provide you with a SOA, you may request a Record Of Advice (ROA) at any time up to 7 years after the advice was provided by calling your broker, your nearest branch or our Toll Free Client Inquiry Line, 1800 284 627.
Our relationship with insurers
We work closely with a range of insurers and underwriting agencies to arrange high quality benefits, competitive pricing and superior service levels for our clients. Wherever possible we will recommend you deal with insurers that are authorised under the Insurance Act 1973 (Cth) to carry on insurance business in Australia. Such insurers are subject to oversight by the Australian Prudential Regulation Authority (APRA). We will warn you when we recommend an unauthorised foreign insurer.
Please note that we cannot guarantee the availability of cover for your particular risks or the solvency of any insurer.
How we can receive your instructions
In order for us to act on your behalf you must provide us with instructions and other information about the services you require. You can give us instructions using the contact details at the end of this FSG or to your broker described in the relevant Authorised Representative Schedule. In some circumstances it may be necessary for you to give us instructions in writing. We will tell you when this is the case.
Cooling off period
Retail insurance policies can be terminated within the first 14 days without penalty. If you choose to take advantage of this option, the insurance contract will be terminated from inception and the premium will be returned to you in full. You cannot withdraw from the contract if you have made a claim under it.
Waiver of rights and disclaimers
Some insurance policies limit or exclude claims where the insured has limited or waived their right to recover a loss from the person who was responsible for causing the loss. You should not sign any agreement that modifies or limits your rights of recovery from another party. You should always seek professional advice before signing such a disclaimer. Whenever you are asked to sign such a disclaimer you should seek advice first.
Important relationships and conflicts of interest
In some cases we may refer or advise you to use the services of other companies in the Gallagher Group both in Australia and overseas. All negotiations with other companies in the Gallagher Group are carried out at an arm’s length as if we were conducting business with an unrelated third party.
We have a preferred panel of insurers with which we place business and we work closely with these insurers to ensure our clients receive high quality product benefits, competitive pricing and appropriate service levels.
Where there are potential conflicts of interest in our remuneration arrangements or in our dealings with related parties, they are managed in accordance with our conflicts of interest policy which all staff and representatives must comply with.
Our remuneration, including how we and our representatives are paid
Commissions and professional broking fees
Typically, we will charge you a professional broking fee or obtain a commission from the insurer based on the service we provide. We may sometimes also receive both a broking free and commission. Our professional fees will vary depending on the level of service we provide and whether we also receive a commission.
The amount of commission varies depending on the market and the risk, but is generally calculated at a rate that is between 0% and 40% of the insurer’s base premium (i.e. excluding government charges, taxes, fees or levies). Often an insurer will agree to pay us by allowing us to deduct the value of the commission from the premium paid by you before we pass the balance of the premium on to the insurer.
We may also charge separate broking administration fees to cover any related administration and processing costs. Our fees vary depending on the costs associated with providing the services you require. Where applicable, our broking administration fees will be detailed on your invoice, and provided to you at the time you receive advice or as soon as practical after that time.
Our remuneration is payable on the terms of our invoice and is considered fully earned at the time that we issue the invoice. If your insurance contract is cancelled or varied before the expiry of the period of insurance, you will be paid any refunded pro-rata premium received from the insurer. We will retain all of our commission, fees and other remuneration in full in the event of any early cancellation or variation of your insurance contract or adjustment of premium. We may charge an additional fee for processing your request to cancel or vary your insurance contract and you agree that this fee may be offset against any premium pro-rata refund you are entitled to.
How we remunerate our employees
Our remuneration arrangements provide incentives to our employed brokers to ensure our clients receive practical and effective advice and service. Our employees receive a salary and may also receive a performance bonus based on both the value and quality of the work they do for our clients. In limited circumstances, some employees may also receive additional payments related to clients they have referred to a third party.
From time to time, our employees may also be invited to an annual conference, receive sponsorship for conferences, functions, meals or other non-monetary benefits from external parties such as insurers, underwriting agencies or reinsurers. You do not bear the cost of sending our employees to these events and such relationships are managed under our conflicts of interest policy.
How we remunerate our Authorised Representatives and Distributors
If your broker is an Authorised Representative, he or she is generally paid a retainer fee that may also be supplemented by an additional payment based on performance. Any additional payment will be calculated on the level of the retainer and will be between 5% and 60% of the commission we receive in respect of business arranged or serviced by the Authorised Representative. Alternatively, the Authorised Representative may be paid a flat recurring fee.
If an Authorised Representative provides you with personal advice, additional information explaining how they are remunerated will be included in the Authorised Representative Schedule.
Distributors do not receive a salary. Instead they may be paid a percentage of the commission and/or other part of remuneration for the Financial Services they provide.
Remuneration arrangements within the Gallagher Group
If we recommend a product or service of a company in the Gallagher Group or refer you to another company within the Gallagher Group, we may receive benefits as a result of the referral or the business you subsequently do with that company. The benefits may include:
- If we refer you to Monument, we may receive a commission of up to a maximum of 5% of any funding provided by Monument. We may also be entitled to a bonus paid as a percentage of the premiums funded and a share of Monument’s profit.
- If we recommend a product offered by Pen, MA Underwriting or any other company within the Gallagher Group, the company may pay us an annual bonus based on premium growth and/or a payment based on the profitability of the products we recommend to you. These payments will be in addition to any commissions the company may pay us and any service or other fees we may charge you.
- If we refer you to Gallagher Benefit Services (ABN 49 611 343 803), we may receive a commission of up to 25% of the income generated in the first 12 months following the referral. We may share up to two-thirds of this amount with the employee who makes the referral.