An Act relating to Insurance intermediaries

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Part I—Preliminary

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1 Short title [see Note 1]

This Act may be cited as the Insurance (Agents and Brokers) Act 1984.

2 Commencement [see Note 1]

(1) Part I, Part II (other than sections 10 and 12) and Part IV (other than section 37) shall come into operation on the day on which this Act receives the Royal Assent.

(2) The remaining provisions of this Act shall come into operation on such day as is, or such days as respectively are, fixed by Proclamation.

3 Crown to be bound

(1) This Act binds the Crown in right of the Commonwealth or of a Territory in which this Act applies or to which this Act extends but does not bind the Crown in right of a State.

(2) Nothing in this Act renders the Crown in right of the Commonwealth or of a Territory liable to be prosecuted for an offence arising under this Act.

4 Extension to external Territories

This Act extends to an external Territory that is for the time being declared by Proclamation to be a Territory to which this Act extends.

It is the intention of the Parliament that this Act is not, except in so far as this Act, either expressly or by necessary intendment, otherwise provides, to affect the operation of any other law of the Commonwealth, the operation of a law of a State or Territory or the operation of any principle or rule of the common law or of equity.

6 Application of Act

(1) Subject to sections 7 and 8, the application of this Act extends to contracts of insurance and proposed contracts of insurance, and to conduct in connection with such contracts and proposed contracts, being contracts or proposed contracts the proper law of which is or would be the law of a State or of a Territory in which this Act applies or to which this Act extends.

(2) For the purposes of subsection (1), where the proper law of a contract or proposed contract would, but for an express provision to the contrary included or to be included in the contract or in some other contract, be the law of a State or of a Territory in which this Act applies or to which this Act extends, then, notwithstanding that provision, the proper law of the contract is the law of that State or Territory.

7 Exceptions to application of Act

This Act does not apply to or in relation to contracts and proposed contracts:

(a) of reinsurance; or

(b) of insurance entered into, or proposed to be entered into, by a registered health benefits organization, as an insurer, in the course of its business as a registered organization within the meaning of Part VI of the National Health Act 1953; or

(c) of insurance entered into, or proposed to be entered into, by the Export Finance and Insurance Corporation under the Export Finance and Insurance Corporation Act 1991.

8 State and Northern Territory insurance

This Act does not apply to or in relation to:

(a) State insurance or Northern Territory insurance; or

(b) a contract of insurance or proposed contract of insurance entered into or proposed to be entered into by:

(i) a State or the Northern Territory; and

(ii) some other insurer;

as joint insurers.

9 Definitions [see Note 2]

In this Act, unless the contrary intention appears:

accounting period means:

(a) in relation to a corporation—the period in respect of which any profit and loss account of the corporation laid before it in general meeting is made up, whether that period is a year or not;

(b) in relation to a person (other than a corporation) in relation to whom an accounting period is applicable as a year of income for the purposes of the Income Tax Assessment Act 1936 or as an income year for the purposes of the Income Tax Assessment Act 1997—that accounting period; and

approved auditor means a person included in a class of persons specified in regulations made for the purposes of this definition.

approved form means a form approved under section 9C.

authorised officer, when used in a particular provision of this Act, means a person authorised by the Commissioner to exercise powers or perform functions under that provision.

binder means:

(a) an authority given by an insurer to an insurance intermediary to enter into, as agent for the insurer, contracts of insurance on behalf of the insurer as insurer; or

(b) an authority given by an insurer to an insurance intermediary to deal with and settle, as agent for the insurer, claims against the insurer as insurer;

but does not include an authority of a kind referred to in paragraph (a) that is limited to effecting contracts of insurance, or contracts of insurance of a particular class, by way of interim cover unless there is also in existence an authority given by the insurer to the insurance intermediary to enter into, as agent for the insurer and otherwise than by way of interim cover, contracts of insurance, or contracts of insurance of that class, as the case may be.

class of insurance business means:

(a) life insurance business; or

(b) a class of insurance business prescribed for the purposes of subsection 42(2) of the Insurance Act 1973.

Commissioner means the Insurance and Superannuation Commissioner appointed under the Insurance and Superannuation Commissioner Act 1987, or a person for the time being acting as Insurance and Superannuation Commissioner under that Act.

contract of insurance includes a contract of life insurance.

Note: Contract of life insurance has a meaning affected by section 9D.

corporation means a body corporate constituted by a law of the Commonwealth or of a State or Territory or a company.

foreign agency agreement, in relation to a person, means an agreement that authorises the person, as agent for an unauthorised foreign insurer, to arrange contracts of general insurance.

foreign insurance agent means a person who carries on the business of arranging contracts of general insurance, whether in Australia or elsewhere, as agent for an unauthorised foreign insurer.

general insurance broker means a person who is for the time being registered under Part III in respect of general insurance business.

general insurance business has the same meaning as insurance business has in the Insurance Act 1973.

insolvent company under administration means a company:

(a) that has entered into a compromise or arrangement with its creditors, or a class of them, the administration of which has not ended; or

(b) in respect of property of which a receiver, or a receiver and manager, has been appointed (whether or not by a court) and is acting; or

(d) that has executed under Part 5.3A of that Law a deed of company arrangement that has not yet terminated; or

(e) that is under official management; or

(f) that is being wound up; or

(g) in respect of which a provisional liquidator has been appointed and not since removed.

insolvent under administration means a person who:

(a) under the Bankruptcy Act 1966 or the law of an external Territory, is a bankrupt in respect of a bankruptcy from which the person has not been discharged; or

(b) under the law of an external Territory or the law of a foreign country, has the status of an undischarged bankrupt;

and includes:

(i) section 50 or Division 2 of Part X of the Bankruptcy Act 1966; or

(ii) a corresponding provision of the law of an external Territory or the law of a foreign country; or

(d) a person who has, at any time during the preceding 3 years, executed a deed of assignment or a deed of arrangement under:

(i) Part X of the Bankruptcy Act 1966; or

(ii) the corresponding provisions of the law of an external Territory or the law of a foreign country; or

(e) a person whose creditors have, within the preceding 3 years, accepted a composition under:

(i) Part X of the Bankruptcy Act 1966; or

(ii) the corresponding provisions of the law of an external Territory or the law of a foreign country.

insurance broker means a person who carries on the business of arranging contracts of insurance, whether in Australia or elsewhere, as agent for intending insureds.

insurance intermediary means a person who:

(a) for reward; and

(b) as an agent for one or more insurers or as an agent for intending insureds;

arranges contracts of insurance in Australia or elsewhere, and includes an insurance broker.

insured, in relation to a contract of life insurance, means a person (other than the insurer) who is entitled to a benefit under the contract, whether that person is the life insured or some other person, and intending insured has a corresponding meaning.

life insurance broker means a person who is for the time being registered under Part III in respect of life insurance business.

life insurance business has the same meaning as in the Life Insurance Act 1995.

registered foreign insurance agent means a person who is for the time being registered under Part IIIA.

registered insurance broker means a person who is for the time being registered under Part III, whether in respect of general insurance business or life insurance business or in respect of each of those businesses.

unauthorised foreign insurer means an insurer who:

(a) does not have an authority under the Insurance Act 1973 to carry on insurance business;

(b) is not a person who, because of section 5 of that Act, is not required to have such an authority; and

(c) carries on insurance business outside Australia and the external Territories to which the Insurance Act 1973 extends.

9A Meaning of references to arranging contracts etc. with unauthorised foreign insurers

A reference in this Act to a person arranging a contract as agent for an unauthorised foreign insurer or arranging a contract with an unauthorised foreign insurer includes a reference to the person arranging a contract as agent for, or arranging a contract with, 2 or more insurers including one or more unauthorised foreign insurers.

9B Meaning of acceptable contracts of professional indemnity insurance

(1) An acceptable contract of professional indemnity insurance, in relation to liabilities that are prescribed for the purposes of a nominated provision, means a contract of insurance:

(a) that is accepted by the Commissioner; and

(b) that contains a clause indicating that the parties to the contract intend that any claim under the contract will be determined according to the law of a State or Territory specified in the contract; and

(c) under which the insured is indemnified to the extent required by the regulations in respect of the prescribed liabilities arising out of or in the course of the insured’s business as an insurance intermediary.

(2) Regulations specifying the extent to which a person is to be indemnified under an acceptable contract of professional indemnity insurance may make provision for different amounts according to the date on which the contract is entered into or renewed.

(3) Despite section 28 of the Insurance Contracts Act 1984:

(a) a failure to comply with a duty of disclosure by a person seeking to enter into an acceptable contract of professional indemnity insurance; or

(b) a misrepresentation by such a person to an insurer before such a contract was entered into;

whether that failure or misrepresentation was fraudulent or not, is not a ground for the insurer to avoid the contract or to reduce its liability under the contract.

(4) An acceptable contract of professional indemnity insurance in respect of liabilities that are prescribed for the purposes of a nominated provision must provide that, despite the fact:

(a) that the person entering into the contract subsequently ceases to trade as an insurance intermediary; or

(b) that the contract is cancelled under subsection (5);

that person, or any other person who becomes responsible for the liabilities of that person, is to continue to be indemnified in relation to a claim:

(d) that gives rise to such a prescribed liability;

if that claim is made within the period after entry into that last-mentioned contract of insurance that is, at the time of entry into that contract, prescribed by regulations made for the purposes of this subsection.

(5) The insurer under an acceptable contract of professional indemnity insurance must not cancel the contract unless, at least 3 business days before the date of intended cancellation of the contract, the Commissioner is notified in writing by the insurer or by the agent of the insurer:

(a) of the insurer’s intention to cancel the contract; and

(b) of the date of the intended cancellation of the contract; and

Penalty: 150 penalty units.

(6) For the purposes of subsection (5), the following days do not count as business days:

(a) a Saturday or a Sunday;

(b) a day that is a public holiday or a bank holiday;

(i) in the Australian Capital Territory; and

(ii) if the insured is a natural person—in the place of residence of the insured; and

(iii) if the insured is a company—in the State or Territory in which the insured is incorporated; and

(iv) if the insured is a partnership or a body corporate other than a company—in the principal place of business of the insured.

(7) A provision in a contract of professional indemnity insurance has no effect if it purports to permit the contract to be cancelled by a person (the premium funder) who has entered into a loan agreement with the insured for the provision of all or a part of the premium payable under the contract if the insured is unable or unwilling to comply with the terms of the loan agreement.

(8) In this section:

nominated provision means:

(a) paragraph 19(1)(b); or

(b) subparagraph 31B(1)(a)(ii) or (b)(ii).

9C Approved form

(1) In this Act, a reference to an approved form is a reference to a form that is approved, by written instrument, by the Commissioner.

(2) The instrument by which a form is approved under subsection (1) after this section commences is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.

9D Extended meaning of contract of life insurance

(1) For the purposes of this Act, if:

(a) a life policy (within the meaning of the Life Insurance Act 1995) would not ordinarily be regarded as a contract of life insurance; and

(b) liability under the policy is borne by a company registered under the Life Insurance Act 1995; and

the policy is taken to be a contract of life insurance.

(2) Without prejudice to its effect apart from this subsection, subsection (1) also has the effect it would have if the reference to a company were, by express provision, confined to a company that is a corporation to which paragraph 51(xx) of the Constitution applies.

Part II—General

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10 Insurance intermediaries other than brokers to operate under written agreements

(1) An insurance intermediary (other than an insurance broker) shall not arrange, or hold the intermediary out as entitled to arrange, a contract of insurance as agent for an insurer unless an agreement in writing between the intermediary and the insurer authorizes the intermediary to arrange:

(a) that contract;

(b) any contracts of insurance; or

as agent for that insurer.

(2) An insurer shall not cause or permit an insurance intermediary (other than an insurance broker) to arrange, or hold the intermediary out as entitled to arrange, a contract of insurance as agent for that insurer unless an agreement in writing between the insurer and the intermediary authorizes the intermediary to arrange:

(a) that contract;

(b) any contracts of insurance; or

as agent for that insurer.

(2A) An agreement referred to in this section must specify whether an insurance intermediary can appoint a person as the intermediary’s agent for the purposes of the agreement.

(3) Subsections (1) and (2) do not apply in relation to any act or thing done by an employee of an insurer in the course of performing his or her duties as such an employee.

(4) Where an insurance intermediary to whom subsection (1) applies proposes, or holds the intermediary out as entitled, to arrange, or has arranged, a contract of insurance as agent of an insurer, the Commissioner, or the intending insured or the insured, may request the intermediary to give him or her a copy of the agreement authorizing the intermediary to arrange that contract, and, if such a request is made, the intermediary shall comply with the request within 7 days after the day on which the request is received by the intermediary.

(5) The Commissioner may request an insurer to give him or her a copy of the agreement referred to in subsection (2) that is in force between the insurer and an insurance intermediary referred to in the request, and, if such a request is made, the insurer shall comply with the request within 7 days after the day on which the request is received by the insurer.

(6) The validity of a contract of insurance is not affected by a contravention of this section.

Penalty: Imprisonment for 6 months.

Note: Subsection 4B(2) of the Crimes Act 1914 allows a court to impose an appropriate fine instead of, or in addition to, a term of imprisonment. If a body corporate is convicted of an offence, subsection 4B(3) of that Act allows a court to impose a fine of an amount that is not greater than 5 times the maximum fine that could be imposed by a court on an individual convicted of the same offence.

11 Liability for conduct of agents and employees

(1) This section applies to any conduct of an employee or agent of an insurer:

(a) on which a person in the circumstances of the insured or intending insured could reasonably be expected to rely; and

(b) on which the insured or intending insured in fact relied in good faith.

(1A) An insurer is responsible, as between the insurer and the insured or intending insured, for the conduct of an employee of the insurer in relation to any matter relating to insurance, whether or not the employee acted within the scope of his or her employment.

(1B) If a person is the agent of one insurer only, the insurer is responsible, as between the insurer and the insured or intending insured, for the conduct of the agent in relation to any matter relating to insurance, whether or not the agent acted within the scope of the authority granted by the insurer.

(1C) If:

(a) a person who is the agent of more than one insurer is the agent of one insurer only in respect of a particular class of insurance business; and

(b) the person engages in the conduct in relation to any matter relating to that class of insurance business;

the insurer who granted the agency agreement in respect of that class of insurance business is responsible for the conduct, as between the insurer and the insured or intending insured, whether or not the agent has acted within the scope of the authority granted by the insurer.

(1D) If:

(a) a person is the agent of more than one insurer in respect of a particular class of insurance business; and

(b) the person engages in the conduct in relation to any matter relating to that class of insurance;

the insurers are jointly and severally responsible for the conduct, as between themselves and the insured or intending insured, if the agent has acted beyond the scope of the authority granted by any of the insurers.

(1E) If:

(a) a person is the agent of more than one insurer in respect of a particular class of insurance business; and

(b) the person engages in the conduct in relation to a matter relating to that class; and

that insurer is responsible for the conduct, as between the insurer referred to in paragraph (c) and the insured or intending insured.

(1F) If:

(a) a person is the agent of more than one insurer in respect of a particular class of insurance business; and

(b) the person engages in the conduct in relation to a matter relating to that class; and

the insurers referred to in paragraph (c) are jointly and severally responsible for the conduct, as between themselves and the insured or intending insured.

(1G) If:

(a) a person is the agent of more than one insurer; and

(b) the person engages in the conduct in relation to any matter relating to a class of insurance business in which the person is not the agent of any of those insurers;

the insurers are jointly and severally liable for the conduct, as between themselves and the insured or intending insured, despite the fact that the agent acted outside the scope of the authority granted by any of the insurers.

(1H) If:

(a) a person (the principal agent) is the agent of an insurer; and

(b) the principal agent appoints a second person (the sub-agent) to act as agent of the principal agent;

then, for the purpose of determining the ultimate responsibility of the insurer under this section, the actions of the sub-agent are to be taken to be the actions of the principal agent:

(c) whether the agency agreement entered into between the principal agent and the insurer permitted or forbade the principal agent to appoint the sub-agent; and

(d) whether or not the sub-agent acted within the scope of his or her authority.

(1J) If:

(a) a person is the agent of at least one insurer in respect of life insurance business; and

(b) the person is the agent of at least one other insurer in respect of another class of insurance business (general insurance business);

the provisions of this section do not operate:

(c) if the person engages in the conduct in relation to life insurance business—so as to make any insurer referred to in paragraph (b) responsible for the conduct; and

(d) if the person engages in conduct in relation to general insurance business—so as to make any insurer referred to in paragraph (a) responsible for the conduct.

(1K) If:

(a) a person is the agent of more than one insurer in respect of a particular class of insurance business; and

(b) the person engages in the conduct in relation to a matter relating to that class; and

then, for the purposes of this section, the agent is taken, in respect of the conduct, to have acted within the scope of the authority granted by the insurer or each insurer who so entered into a contract of insurance.

(2) The responsibility of an insurer under subsection (1A), (1B), (1C), (1D), (1E), (1F), (1G) or (1H) extends so as to make the insurer liable to an insured or intending insured in respect of any loss or damage suffered by the insured or intending insured as a result of the conduct of the agent or employee.

(3) Subsections (1A), (1B), (1C), (1D), (1E), (1F), (1G), (1H) and (1J) and (2) do not affect any liability of an agent or employee of an insurer to an insured or intending insured.

(4) An agreement, in so far as it purports to alter or restrict the operation of subsection (1A), (1B), (1C), (1D), (1E), (1F), (1G), (1H), (1J) or (2), is void.

(5) An insurer shall not make, or offer to make, an agreement that is, or would be, void by reason of the operation of subsection (4).

Penalty: 150 penalty units.

12 Certain insurance intermediaries to be agents of insurers

(1) Subject to this section, an insurance intermediary shall be deemed, in relation to any matter relating to insurance and as between an insured or intending insured and an insurer, to be the agent of the insurer and not of the insured or intending insured.

(2) Subsection (1) does not apply to a general insurance broker in relation to any matter relating to general insurance business.

(3) Subsection (1) does not apply to a life insurance broker in relation to any matter relating to life insurance business.

(4) Subsection (1) does not affect any liability to which, if that subsection had not been enacted, an insurer would have been subject in respect of the conduct of an insurance intermediary.

13 Representations etc. by intermediaries

(1) A person to whom this section applies shall not with intent to deceive make a false or misleading statement:

(a) as to any amount that would be payable in respect of a proposed contract of insurance; or

(b) as to the effect of any of the provisions of a contract of insurance or of a proposed contract of insurance.

(1A) A reference in subsection (1) to making a misleading statement includes a reference to omitting to disclose matter that is material to a statement.

(2) A person to whom this section applies shall not with intent to deceive, in relation to a proposed contract of insurance:

(a) write on a form, being a form that is given or sent to the insurer, matter that is material to the contract and is false or misleading in a material particular;

(b) omit to disclose to the insurer matter that is material to the proposed contract;

(c) advise or induce the intending insured to write on a form, being a form that is given or sent to the insurer, matter that is false or misleading in a material particular; or

(d) advise or induce the intending insured to omit to disclose to the insurer matter that is material to the proposed contract.

(3) A person to whom this section applies shall not with intent to deceive, in relation to a claim under a contract of insurance:

(a) fill up, in whole or in part, a form, being a form that is given or sent to the insurer, in such a way that the form is false or misleading in a material particular;

(b) omit to disclose to the insurer matter that is material to the claim;

(c) induce the insured to fill up, in whole or in part, a form, being a form that is given or sent to the insurer, in such a way that the form is false or misleading in a material particular; or

(d) advise or induce the insured to omit to disclose to the insurer matter that is material to the claim.

(4) An act done in contravention of subsection (1) or (2) constitutes an offence against the subsection concerned notwithstanding that a contract of insurance does not come into being.

(5) The persons to whom this section applies are:

(a) insurance intermediaries; and

(b) agents and employees of insurance intermediaries and of insurers.

Penalty: Imprisonment for 2 years.

14 Effect of payments to intermediaries

(1) Where a contract of insurance is arranged or effected by an insurance intermediary, payment to the insurance intermediary of moneys payable by the insured to the insurer under or in relation to the contract, whether in respect of a premium or otherwise, is a discharge, as between the insured and the insurer, of the liability of the insured to the insurer in respect of those moneys.

(2) Payment to an insurance intermediary by or on behalf of an intending insured of moneys in respect of a contract of insurance to be arranged or effected by the intermediary, whether the payment is in respect of a premium or otherwise, is a discharge, as between the insured and the insurer, of any liability of the insured under or in respect of the contract, to the extent of the amount of the payment.

(3) Payment by an insurer to an insurance intermediary of moneys payable to an insured, whether in respect of a claim, return of premiums or otherwise, under or in relation to a contract of insurance, does not discharge any liability of the insurer to the insured in respect of those moneys.

(4) An agreement, in so far as it purports to alter or restrict the operation of subsection (1), (2) or (3), is void.

(5) Subsection (4) does not render void an agreement between an insurance intermediary and an insured in so far as the agreement allows the insurance intermediary to set off against moneys payable to the insured moneys payable by the insured to the insurance intermediary in respect of premiums.

15 Liability in relation to authorities

Where a contract of insurance is entered into, or a claim under a contract of insurance is dealt with or settled, by an insurance intermediary who acted under a binder in relation to the contract or claim, the intermediary shall, with respect to the contract or claim, and with respect to all matters relating to the contract or claim, be deemed to be the agent of the insurer and not of the insured for all purposes, including the operation of section 11, and, if the insured in fact relied in good faith on the conduct of the insurance intermediary, shall be so deemed notwithstanding that the intermediary did not act within the scope of the intermediary’s authority under the binder.

16 Disclosure by persons acting under authorities in respect of insurance contracts

(1) An insurance intermediary who intends to act under a binder in effecting a contract of insurance on behalf of the intermediary’s principal must:

(a) subject to paragraph (b), clearly inform the intending insured, before the intermediary enters into the contract, that, in effecting the contract, the intermediary will be acting under an authority given to the intermediary by the insurer to effect the contract and that the intermediary will be effecting the contract as agent of the insurer and not of the intending insured; or

(b) if it is not practicable for the intermediary to comply with paragraph (a), clearly inform the insured, as soon as is reasonably practicable after the intermediary has effected the contract, that, in effecting the contract, the intermediary acted under an authority given to the intermediary by the insurer to effect the contract and that the intermediary effected the contract as agent of the insurer and not of the insured.

Penalty: 60 penalty units.

(1A) A registered insurance broker who intends to act under an agreement of a kind referred to in section 10 in arranging a contract of insurance as agent for an insurer shall:

(a) subject to paragraph (b), clearly inform the intending insured, before the broker arranges the contract, that, in arranging the contract, the broker will be acting under an authority given by the insurer to arrange the contract and that the broker will be arranging the contract as agent of the insurer and not of the intending insured; or

(b) if it is not practicable to comply with paragraph (a), clearly inform the insured, as soon as is reasonably practicable after the broker has arranged the contract, that, in arranging the contract, the broker acted under an authority given by the insurer to arrange the contract and that the broker arranged the contract as agent of the insurer and not of the insured.

Penalty: 60 penalty units.

(2) A contract made in contravention of this section is voidable at the option of the insured, subject to:

(a) the rights of parties acquired without notice and for good or valuable consideration; and

(b) compliance with the principles of common law and of equity with respect to the avoidance of contracts.

17 Disclosure by persons acting under binders or agency agreements in respect of claims

(1) An insurance intermediary who intends to act under a binder in dealing with or settling a claim under a contract of insurance must not deal with or settle the claim on behalf of the intermediary’s principal unless the intermediary has first clearly informed the insured that, in dealing with or settling the claim, the intermediary will be acting under an authority given to the intermediary by the insurer to deal with or settle the claim and that the intermediary will be dealing with or settling the claim as agent of the insurer and not of the insured.

Penalty: 60 penalty units.

(1A) A registered insurance broker who intends to act under an agency agreement (other than a binder) with an insurer in dealing with or settling a claim under a contract of insurance must not deal with or settle the claim on behalf of the insurer unless the broker has first clearly informed the insured that, in dealing with or settling the claim, the broker:

(a) will be acting under an authority given to the broker by the insurer to deal with or settle the claim; and

(b) will be dealing with or settling the claim as agent of the insurer and not of the insured.

Penalty: 60 penalty units.

(2) A settlement of a claim made in contravention of subsection (1) or (1A) is voidable at the option of the insured, subject to:

(a) the rights of parties acquired without notice and for good or valuable consideration; and

(b) compliance with the principles of common law and of equity with respect to the avoidance of contracts.

Part III—Registration of Insurance Brokers

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18 Interpretation

(1) If this Act is extended to an external Territory, a reference in a provision of this Part to the commencement of this Part shall, for the purposes of the application of that provision in that Territory, be construed as a reference to the commencement of the day on which this Act was extended to that Territory or the commencement of this Part, whichever is the later.

(2) If the registration of a person as an insurance broker is suspended or cancelled or expires, sections 26, 27 and 28 continue to apply in relation to the broker or the broker’s estate in respect of matters that occurred before the suspension, cancellation or expiry as if the broker’s registration had not been suspended or cancelled or had not expired, as the case may be.

19 Brokers not to carry on business unless registered

(1) A person (whether an individual or a corporation) shall not, after the expiration of 6 months after the commencement of this Part, carry on business as an insurance broker, whether alone or in partnership, in relation to life insurance business or general insurance business:

(a) unless the person is registered under this Part in respect of life insurance business or general insurance business, as the case may be; and

(b) if there are liabilities prescribed for the purposes of this paragraph—unless there is in force an acceptable contract of professional indemnity insurance within the meaning of section 9B; and

(c) if the person carries on business as an insurance broker in relation to a class of general insurance business that, under the regulations, is domestic or personal insurance business and there is in force an arrangement, approved by the Commissioner, for dealing with complaints against persons carrying on business as insurance brokers in relation to that class of general insurance business—unless the person is a party to the arrangement.

Penalty: Imprisonment for 2 years.

(2) A person may be registered in respect of both life insurance business and general insurance business.

(3) The Commissioner may, by notice in writing served on the registered insurance broker concerned, declare that a contract specified in the notice is no longer an acceptable contract of professional indemnity insurance for the purposes of paragraph 19(1)(b).

(4) A notice served under subsection (3) has effect on a day specified in the notice, being a day not less than 21 days after service of the notice.

20 Applications for registration

(1) A person may apply to the Commissioner:

(a) to be registered under this Part in respect of life insurance business or in respect of general insurance business; or

(b) to renew the person’s registration under this Part.

(2) An application under subsection (1) shall be in accordance with the approved form.

(2A) For the avoidance of doubt, it is declared that an approved form made for the purposes of subsection (2) may include the requirement to provide:

(a) information required for statistical purposes; and

(b) information that is, or may be, required to be given to the Commissioner under any other provision of this Act or the regulations.

(3) A person shall not with intent to deceive:

(a) make a false or misleading statement in, or omit material matter from, an approved form given to the Commissioner under subsection (1); or

(b) give to the Commissioner in connection with an application under subsection (1) information that is false or misleading in a material particular.

Penalty: Imprisonment for 2 years.

21 Registration of brokers

(1) Subject to subsection (2), if a person who proposes to carry on business as an insurance broker applies under section 20 for registration under this Part, the Commissioner must register the applicant and give the applicant a certificate of registration if:

(a) the Commissioner is satisfied that there is in force any contract of insurance required under paragraph 19(1)(b); and

(b) the applicant has produced to the Commissioner a copy of each foreign agency agreement (if any) that authorises the applicant to arrange contracts as agent for an insurer; and

(ba) if the application is for registration in respect of a class of general insurance business that, under the regulations, is domestic or personal insurance business and there is in force an arrangement, approved by the Commissioner, for dealing with complaints against persons carrying on that class of general insurance businessthe Commissioner is satisfied that the person is a party to the arrangement; and

(1A) Subject to subsection (2), if:

(a) a person is registered under this Part; and

(b) the person applies under section 20 to renew the registration;

the Commissioner must renew the registration and give the applicant a certificate of renewal of registration if:

(c) the Commissioner is satisfied that there is in force in respect of the applicant any contract of insurance required under paragraph 19(1)(b); and

(d) the applicant has produced to the Commissioner a copy of each foreign agency agreement (if any) that authorises the applicant to arrange contracts as agent for an insurer; and

(da) if the application is for renewal of registration in respect of a class of general insurance business that, under the regulations, is domestic or personal insurance business and there is in force an arrangement, approved by the Commissioner, for dealing with complaints against persons carrying on that class of general insurance businessthe Commissioner is satisfied that the person is a party to the arrangement; and

(e) the applicant has produced, or produces, satisfactory audited accounts of the applicant’s business as an insurance broker, in respect of the accounting period ending on, or not more than 12 months before, the day that the registration would end if it is not renewed; and

(f) the applicant has paid the prescribed fee.

Note: A person can carry on business as an insurance broker only if the person is registered under this Part (see sections 19, 21 and 24).

(2) If:

(a) an applicant, or a director, employee or agent of an applicant has been convicted of an offence referred to in subsection 25(1); or

(b) an applicant, or a director, employee or agent of an applicant, is bankrupt or insolvent; or

(c) an applicant, or an associated insurance intermediary within the meaning of section 41B, has failed to discharge the ordinary obligations of an insurance intermediary as set out in decision-making principles in force under section 41A;

the Commissioner may refuse to register the applicant or renew the applicant’s registration.

(3) Registration of a person and the renewal of a person’s registration each has effect for a period of one year.

(3A) Within 4 months after the end of each accounting period, a registered insurance broker must produce satisfactory audited accounts for that period to the Commissioner.

Penalty: 30 penalty units.

(3B) If, before the end of the 4 month period referred to in subsection (3A), the Commissioner grants a registered insurance broker an extension of time to produce the accounts, the broker must produce the accounts within the extended period.

Penalty: 30 penalty units.

(4) If a registered insurance broker applies to the Commissioner for the cancellation of the registration of the broker under this section and the Commissioner is satisfied that the broker is no longer carrying on business as an insurance broker in relation to life insurance business or general insurance business, as the case may be, the Commissioner may cancel the registration of the broker under this section in respect of the insurance business concerned.

(5) If the Commissioner:

(a) registers an applicant; or

(b) renews the registration of an applicant; or

(d) cancels the registration of an insurance broker under subsection (4);

the Commissioner must publish notice of it in the Gazette.

(6) If:

(a) a broker provides audited accounts to the Commissioner under this section; and

(b) those accounts do not meet the requirement specified in paragraph (a), (b), (c), (d) or (e) of the definition of satisfactory audited accounts in subsection (7); and

(c) the broker, at the request of the Commissioner, gives the Commissioner a written explanation why the requirement has not been met;

the Commissioner may renew the broker’s registration if the Commissioner is satisfied, having regard to the explanation, that the failure of the accounts to meet that requirement is not attributable to the dishonesty, recklessness or financial mismanagement of the broker.

(7) In this section:

satisfactory audited accounts, in relation to a broker, include, but are not limited to, the following:

(a) accounts that are in an approved form;

(b) accounts that are arithmetically correct;

(i) the amount of an account maintained by the broker under subsection 26(1); and

(ii) the amount of prescribed investments by the broker; and

(iii) amounts due to the broker from insurance debtors;

is equal to, or exceeds, all the broker’s insurance liabilities;

(d) accounts that indicate that the broker is able to meet the broker’s financial obligations as they fall due;

(e) accounts that contain such other information as is required by the approved form;

(f) accounts that are audited by an approved auditor.

22 Registers to be kept

(1) For the purposes of this Act, the Commissioner shall cause registers to be kept, to be known as the Register of Life Insurance Brokers and the Register of General Insurance Brokers.

(2) Subject to this Act and to any regulations, a Register shall be kept in such form and manner as the Commissioner directs.

23 Inspection of documents

A person may, on application made in accordance with the regulations and on payment of the prescribed fee (if any):

(a) inspect the Register of Life Insurance Brokers or the Register of General Insurance Brokers;

(b) inspect any accounts lodged by registered insurance brokers with the Commissioner;

(c) inspect a contract of insurance referred to in paragraph 19(1)(b), or a copy of such a contract, that is lodged with the Commissioner;

(d) inspect any document given to the Commissioner under paragraph 21(1)((b));

(e) inspect any document lodged with the Commissioner under section 25A or 25B; and

(f) make a copy of, or take extracts from, anything that the person is entitled to inspect under any of the preceding paragraphs.

24 Delay in registration or renewal

(1) Where:

(a) an application for registration under section 20 is made before the expiration of 6 months after the commencement of this Part to the Commissioner by a person who was carrying on business as an insurance broker in relation to life insurance business or general insurance business at the commencement of this Part; and

(b) the Commissioner has not refused to register the applicant;

the person is not guilty of an offence under section 19 by so carrying on business as an insurance broker in relation to life insurance business or general insurance business, as the case may be, after the expiration of that period of 6 months.

(2) Where:

(a) an application by a registered insurance broker for renewal of the broker’s registration under section 20 is made to the Commissioner before the expiration of the period of registration; and

(b) the Commissioner has not renewed, or refused to renew, the registration of the broker;

then, in spite of the expiration of the period of the registration, the broker shall be deemed, for the purposes of this Act and the regulations, to be registered until the Commissioner renews, or refuses to renew, the broker’s registration.

(3) Subsection (1) ceases to apply to a person in relation to life insurance business or general insurance business if the Commissioner has, by notice in writing to the person, required the person to comply, after such period as is specified in the notice, in relation to life insurance business or general insurance business, as the case may be, with such of the provisions of this Act that are applicable to registered insurance brokers as are so specified and the person has failed to comply with any of those provisions as required by the notice.

(4) The Commissioner may, by signed writing, exempt a person to whom subsection (1) or (2) applies from the requirement to comply, in relation to life insurance business or general insurance business, as the case may be, with such provisions of this Act (not being provisions with which the person is required to comply in relation to the insurance business concerned because of a notice under subsection (3)) as are specified in the instrument of exemption.

25 Suspension or cancellation of registration

(1) The Commissioner may suspend for such period as the Commissioner considers to be appropriate, or cancel, the registration of a person under this Part if the person, or a director, employee or agent of the person, has, whether before or after the registration took place and whether before or after the commencement of this Part, been convicted of an offence:

(a) against or arising under this Act or any law, whether of the Commonwealth, of a State or Territory, or of some other country, in respect of conduct relating to insurance; or

(b) in respect of dishonest conduct;

being an offence that, in the opinion of the Commissioner, renders the person unfit to carry on business as an insurance broker.

(1A) If:

(a) a person registered under this Part, or a director, employee or agent of such a person, becomes bankrupt or insolvent; or

(b) a person registered under this Part fails to discharge the ordinary obligations of an insurance intermediary as set out in decision-making principles in force under section 41A;

the Commissioner may:

(d) cancel the registration of the person.

(1AA) If:

(a) a person carries on business as an insurance broker in relation to a class of general insurance business that, under the regulations, is domestic or personal insurance business; and

(b) there is in force an arrangement, approved by the Commissioner, for dealing with complaints against persons carrying on that class of general insurance business; and

the Commissioner may:

(d) suspend the person’s registration until the person becomes a party to the arrangement; or

(e) cancel the person’s registration.

(1B) If:

(a) the Commissioner renews the registration of a broker after having regard to the audited accounts provided for a particular accounting period; and

(b) during the period of the continued registration audited accounts for the next accounting period are provided to the Commissioner; and

(c) the Commissioner is satisfied that those accounts are such that a further application for the renewal of registration would be refused;

the Commissioner may, despite the fact that the period of renewed registration has not ended:

(d) suspend registration of the broker for such period as the Commissioner considers appropriate; or

(e) cancel the registration of the broker.

(2) While the registration of a person under this Part is suspended, the person shall be deemed not to be registered under this Part.

(3) Notwithstanding subsection (2), a person whose registration is suspended may carry on such of the person’s business as an insurance broker as the Commissioner, by writing signed by him or her, specifies, for such time and subject to such conditions (if any) as the Commissioner, by writing signed by him or her, specifies.

(4) A person shall not carry on business as an insurance broker after the time specified under subsection (3) in relation to the person or fail to comply with a condition under that subsection that is applicable to the person.

Penalty: Imprisonment for 2 years.

(5) Where the Commissioner cancels the registration of a person, the Commissioner may, by signed writing, specify a period during which the person is to be disqualified from registration and, where a period is so specified in relation to a person, the person is disqualified from registration during that period.

(6) A person shall not be registered under this Part while the person’s registration is suspended or while the person is disqualified from registration.

(7) Where the Commissioner suspends or cancels under this section the registration of a person under this Part, the Commissioner shall cause notice of the suspension or cancellation to be published in the Gazette.

25A Annual return

(1) A person who:

(a) has been a registered insurance broker at any time during a particular accounting period of the person; and

(b) during that period, arranged any contract of general insurance with an unauthorised foreign insurer (whether as agent for the insurer or as agent for the intending insured);

shall lodge with the Commissioner a return with respect to the person’s activities as an insurance intermediary during that period (not including any part of the period when the person was not registered).

Penalty: 30 penalty units.

(2) The return:

(a) must be in an approved form;

(b) must contain such information as is required by the form;

(d) unless paragraph (e) applies—must be lodged within 4 months after the end of the accounting period to which it relates; and

(e) if, before the end of the lodgment period referred to in paragraph (d), the Commissioner grants an extension of the lodgment period—must be lodged within the extended period.

(3) Subsection 25(2) does not apply for the purposes of this section.

25B Notification of foreign agency agreements

(1) Where:

(a) a foreign agency agreement is entered into in relation to a registered insurance broker; or

(b) a foreign agency agreement in relation to a registered insurance broker (whether entered into before or after the commencement of this section) is altered or terminated;

the broker shall, within 21 days after the agreement is entered into or the alteration or termination occurs:

(c) in the case of the entering into, or the alteration of, an agreement—lodge with the Commissioner a copy of the agreement or of the alteration, as the case may be; or

(d) in the case of the termination of an agreement—notify the Commissioner in writing of the termination.

Penalty: 30 penalty units.

(2) Subsection 25(2) does not apply for the purposes of this section.

25C Accounting records to be kept by registered brokers

(1) A registered insurance broker must keep records that record and explain:

(a) the transactions engaged in by the broker to carry on business as an insurance broker; and

(b) the financial position of the broker.

(2) The records must be kept so that the broker’s accounts can be properly prepared and audited.

(3) A broker must not, without reasonable excuse, contravene a requirement under this section.

Penalty: 100 penalty units.

26 Insurance broking accounts

(1) A registered insurance broker:

(a) must pay into an account maintained by the broker with a bank solely for the purposes of this section all moneys received by the broker:

(i) from or on behalf of an insured or intending insured for or on account of an insurer in connection with a contract of insurance or proposed contract of insurance; or

(ii) from or on behalf of an insurer for or on account of an insured or intending insured; and

(b) may pay into that account any moneys received by the broker from or on behalf of:

(i) an insured or intending insured; or

(ii) an insurer;

on the broker’s own account in connection with a contract of insurance or proposed contract of insurance.

(1A) In subsection (1), bank includes a building society or credit union.

(1B) If money referred to in subsection (1) is paid to a person who is the agent of a registered insurance broker, the money is taken to have been paid to the broker at the time when it is received by the agent, whether or not the agent acted within the scope of authority granted by the broker.

(2) An account maintained under subsection (1) shall be called an Insurance Broking Account, with or without other words of description.

(3) Except with the written consent of the Commissioner, a registered insurance broker must take all reasonable steps to ensure that, at all times, the sum of:

(a) the balance of an account maintained by the broker under subsection (1); and

(b) the total amount previously withdrawn from the account and currently invested under subsection (4);

is greater than or equal to the sum of:

(d) any amounts that an insured or intending insured is entitled to receive from the account.

(3A) For the purposes of paragraph (3)(c), if, at a particular time, money received by a registered insurance broker for or on account of an insurer as mentioned in subparagraph (1)(a)(i) is paid into an account, the insurer is taken to be entitled to receive payment of:

(a) the amount; or

(b) if any deductions from the amount are authorised by a written agreement between the insurer and the broker—the amount less the deductions;

throughout the period:

(d) ending when the payment is actually made to the insurer;

even if the amount has been invested under subsection (4).

(3B) For the purposes of paragraph (3)(d), if, at a particular time, money received by a registered insurance broker for or on account of an insured or intending insured as mentioned in subparagraph (1)(a)(ii) is paid into an account, the insured or intending insured is taken to be entitled to receive payment of the amount throughout the period:

(a) beginning at that time; and

(b) ending when the payment is actually made to the insured or intending insured;

even if the amount has been invested under subsection (4).

(4) A registered insurance broker may invest in such manner as is prescribed moneys included in an account maintained by the broker under subsection (1) that were received by the broker from an insured or intending insured for or on account of an insurer in connection with a contract of insurance (not being a contract of life insurance).

(5) A registered insurance broker shall pay moneys received from the realization of an investment made under subsection (4) into an account maintained by the broker under subsection (1).

(6) If, upon the realization of an investment made under subsection (4), an amount is received in respect of the realization that is less than the amount invested, the registered insurance broker shall pay into the account from which the moneys were withdrawn for investment an amount equal to the difference between the amount invested and the amount received.

(7) If, upon the realization of an investment under subsection (4), an amount is received in respect of the realization that is greater than the amount invested, the registered insurance broker may retain for the broker’s own benefit the amount by which the amount received exceeds the amount invested and need not pay it into, or retain it in, an account maintained under subsection (1).

(8) Interest, dividends or other income received by a registered insurance broker from an account maintained under subsection (1) or from an investment made under subsection (4) may be retained by the broker for the broker’s own benefit and need not be paid into, or retained in, an account maintained under subsection (1).

(9) Moneys received by a registered insurance broker as mentioned in subsection (1) or (5), both before and after those moneys are paid into an account maintained under subsection (1), moneys paid into such an account under subsection (6) and securities in which moneys are invested under subsection (4) are not capable of being attached or otherwise taken in execution or of being made subject to a set-off, charge or charging order or to any process of a like nature.

(10) Nothing in subsection (9) prevents moneys or securities being attached, taken in execution or made the subject of a set-off, charge, charging order or like process at the suit of a person for whom or on whose account moneys have been paid into the relevant account maintained under subsection (1) and to whom or on whose account payment in respect of those moneys has not been made.

(11) This section does not make a bank, building society or credit union subject to any liability by reason only of a failure of a registered insurance broker to comply with any of the provisions of this section.

Penalty: Imprisonment for 2 years.

27 Debts of broker in relation to premiums etc.

(1) Where:

(a) money is received by a registered insurance broker from, or on behalf of, an insured or intending insured, or from another registered insurance broker on behalf of an insured or intending insured, as a premium or an instalment of a premium in connection with a contract of insurance or a proposed contract of insurance;

(b) the risk, or a part of the risk, to which the contract or proposed contract relates is accepted by or on behalf of an insurer; and

(c) the broker who so received the money is informed of, or otherwise ascertains, the amount of the premium or instalment to be paid;

the broker who so received the money shall pay, in accordance with subsection (2), to the insurer by whom or on whose behalf the risk, or a part of the risk, to which the contract or proposed contract relates is accepted an amount equal to so much of the money as does not exceed the amount of the premium or instalment to be paid.

(2) An amount payable by a registered insurance broker to an insurer under subsection (1) shall be paid:

(a) subject to paragraph (b), within the period (in this section referred to as the relevant period) of 90 days after the day on which the cover provided by the insurer under the contract commences to have effect or the first day of the period to which the instalment relates, as the case may be; or

(b) if it is not practicable for the broker to pay the amount within the relevant period—as soon after the expiration of that period as it is reasonably practicable for the broker to do so.

(3) Where the amount of the premium, or of an instalment of the premium, payable in respect of a contract of insurance has not been received by a registered insurance broker at the expiration of the relevant period, the broker, unless the broker receives the amount before notifying the insurer in accordance with this subsection, shall notify the insurer in writing, within 7 days after the day on which the relevant period expired, that the broker has not received the amount.

(4) Where:

(b) the risk, or a part of the risk, to which the contract or proposed contract relates is accepted by or on behalf of an insurer; and

(c) the broker who so received the money has not been informed of, and has not otherwise ascertained, the amount of the premium or instalment to be paid;

the broker who so received the money shall pay, to the insurer by whom or on whose behalf the risk, or a part of the risk, to which the contract or proposed contract relates is accepted, within the relevant period, or if it is not practicable for the broker to make the payment within the relevant period, as soon after the expiration of that period as it is reasonably practicable for the broker to do so:

(d) in respect of a new contract of insurance, an amount not less than:

(i) the amount of the money so received; or

(ii) 75% of the amount fairly estimated by the broker to be the premium or instalment, as the case may be, that is to be paid;

whichever is the smaller amount; or

(e) in respect of a renewal of a contract of insurance, an amount not less than:

(i) the amount of the money so received; or

(ii) 75% of the previous year’s premium for the risk or of the last instalment of that year’s premium, as the case may be;

whichever is the smaller amount.

(5) Where:

(a) the risk, or a part of the risk, to which a contract of insurance or a proposed contract of insurance relates is accepted by or on behalf of an insurer;

(b) the contract of insurance or proposed contract of insurance has been, or is being, arranged or effected by a registered insurance broker, either directly or through another registered insurance broker; and

(c) the first-mentioned broker has not been informed of, and has not otherwise ascertained, the amount of a premium or of an instalment of a premium to be paid in connection with the contract or proposed contract;

that broker shall, unless the broker is informed of, or otherwise ascertains, the amount of the premium or instalment to be paid before notifying the insurer in accordance with this subsection, notify the insurer in writing, within 10 days after the day on which the risk, or that part of the risk, was so accepted, that the risk, or that part of the risk, has been so accepted but that the broker does not know the amount of the premium or instalment to be paid.

(6) Nothing in the foregoing provisions of this section prevents:

(a) an insurer from making a contract or arrangement with an insurance broker providing for the broker to pay an amount to the insurer before the time by which the broker is required by the provision concerned to pay that amount to the insurer;

(b) an insurer from authorizing an insurance broker in writing to pay on behalf of the insurer, out of the money received by the broker as a premium or instalment of a premium in respect of a contract of insurance arranged with the insurer, any charges required by law to be paid by the insurer in respect of the contract; or

(c) an insurance broker from exercising any legal right available to the broker to deduct from any moneys payable by the broker to the insurer any remuneration payable by the insurer to the broker in relation to a contract of insurance.

(7) If the risk, or a part of the risk, to which a contract or proposed contract referred to in subsection (1) or (4) relates is accepted on behalf of an insurer by an insurance intermediary other than the registered insurance broker who received the moneys from or on behalf of the insured or intending insured, then, for the purposes only of the application of the subsection concerned to the broker, payment of the premium, or part of the premium, as the case may be, by the broker to the intermediary shall be taken to constitute payment of the premium or part of the premium by the broker to the insurer.

(8) Where a registered insurance broker is required to notify an insurer in accordance with subsection (3) or (5) and an insurance intermediary other than the broker has accepted the risk, or a part of the risk, to which the contract or proposed contract relates on behalf of the insurer, then, for the purposes only of the application of the subsection concerned to the broker, notification by the broker to the intermediary shall be taken to constitute notification by the broker to the insurer.

(9) If:

(a) a registered insurance broker receives money from, or on behalf of, an insured or intending insured in connection with a contract of insurance or proposed contract of insurance; and

(b) at the end of 30 days after the day on which the money was received, the risk, or a part of the risk, to which the contract or proposed contract relates has not been accepted;

subsection (9A) or (9B) applies to the broker.

(9A) If the risk to which the contract or proposed contract relates has not been accepted, the broker must, within 7 days after the end of the 30 day period:

(a) give notice in the approved form (if any) to the insured or intending insured that the risk has not been accepted; and

(b) return the money to the insured or intending insured.

(9B) If a part of the risk to which the contract or proposed contract relates has not been accepted, the broker must, within 7 days after the end of the 30 day period:

(a) give notice in the approved form (if any) to the insured or intending insured of the extent to which the risk has not been accepted; and

(b) return that part of the money that relates to the part of the risk that has not been accepted to the insured or intending insured.

(10) Where a registered insurance broker receives money from, or on behalf of, an insurer for payment to, or on behalf of, an insured, the broker shall pay an amount equal to the money to, or on behalf of, the insured:

(a) subject to paragraph (b), within 7 days after the day on which the broker received the money; or

(b) if it is not practicable for the broker to pay the amount within that period—as soon after the expiration of that period as it is reasonably practicable for the broker to pay the amount.

(11) Nothing in subsection (10) prevents:

(a) an insured from making a contract or arrangement with a registered insurance broker providing for the broker to pay an amount referred to in that subsection to or on behalf of the insured before the time by which the broker is required by that subsection to pay that amount to or on behalf of the insured; or

(b) an insurance broker from exercising any legal right available to the broker to deduct from an amount payable by the broker to the insured any money payable by the insured to the broker in connection with a contract of insurance.

(12) An act done in contravention of subsection (1), (2), (3), (4), (5), (9) or (10) constitutes an offence against the subsection concerned notwithstanding that it was done with the consent of the insurer or of the insured or intending insured, as the case may be.

Penalty: Imprisonment for 2 years.

(13) Where:

(a) under subsection (1), (2), (3), (4) or (5), a broker is required to pay an amount to, or to notify, an insurer; and

(b) under the contract or proposed contract of insurance concerned the insurer is an underwriting member of Lloyd’s;

it is sufficient compliance with the subsection if the broker pays the amount to, or notifies, as the case may be, the Lloyd’s broker concerned.

(14) In subsection (13), Lloyd’s has the same meaning as in the Insurance Act 1973.

28 Distribution of insurance broking account moneys on insolvency etc.

(1) This section applies to and in relation to a registered insurance broker:

(a) who has become an insolvent under administration; or

(b) that is an insolvent company under administration;

or to and in relation to the estate of a deceased insurance broker that is being administered under Part XI of the Bankruptcy Act 1966 or under the law of an external Territory providing for the administration of insolvent estates of deceased persons.

(2) This section applies notwithstanding anything to the contrary contained in the Bankruptcy Act 1966 or in a law (including a law of a State or Territory) that relates to companies.

(3) Moneys in an account maintained with a bank by the broker under subsection 26(1), and securities in which moneys have been invested under subsection 26(4), shall be treated as though they were subject to a trust in favour of the persons who, under subsection 26(3A) or (3B), are taken to be entitled to receive payment from that account.

(4) Moneys from such an account shall be paid as follows:

(a) first, moneys that have been paid into the account in error shall be withdrawn from the account;

(b) secondly, insureds shall be paid the amounts they are entitled to receive from the moneys in the account in respect of claims made pursuant to contracts of insurance;

(c) thirdly, insureds shall be paid the amounts (other than amounts to which paragraph (b) applies) they are entitled to receive from the moneys in the account;

(d) fourthly, after all payments have been made under paragraphs (b) and (c), insurers shall be paid the amounts they are entitled to receive from the moneys in the account.

(5) If the moneys in the account that are available to make payments required under a particular paragraph (other than paragraph (a)) of subsection (4) are not sufficient to meet those payments in full, the payments required under the paragraph concerned shall be made proportionally.

(6) Any moneys remaining after all payments have been made under subsection (4) shall be taken to be moneys payable to the broker.

(7) Nothing in the preceding provisions of this section prevents moneys in the account being invested as mentioned in subsection 26(4) by a person, other than the broker, who has lawful custody or control of the moneys.

29 Brokers not bound by certain agreements etc.

(1) A life insurance broker is not bound by an agreement, arrangement or understanding with an insurer in so far as the agreement, arrangement or understanding requires the broker to arrange or effect some or all contracts of life insurance, or some or all contracts of life insurance of a particular class, with that insurer only and with no other insurer.

(2) A general insurance broker is not bound by an agreement, arrangement or understanding with an insurer in so far as the agreement, arrangement or understanding requires the general insurance broker to arrange or effect some or all contracts of insurance (other than contracts of life insurance), or some or all contracts of insurance (other than contracts of life insurance) of a particular class, with that insurer only and with no other insurer.

(3) Neither subsection (1) nor (2) applies to so much of an agreement, arrangement or understanding as relates to contracts of insurance effected under a binder.

(4) The operation of subsections (1) and (2) extends to agreements, arrangements and understandings made or entered into before the commencement of this section or, in relation to an external Territory to which this Act extends, before this section commences to have effect in that Territory.

(5) A person shall not:

(a) make, or offer to make, an agreement or arrangement, or enter into, or offer to enter into, an understanding, that, under the preceding provisions of this section, would not be binding on the person; or

(b) act upon or under such an agreement, arrangement or understanding.

Penalty: Imprisonment for 1 year.

30 Misdescription of business

(1) A life insurance broker (not being also a general insurance broker) shall not describe the broker or the broker’s business in a way that would be likely to lead a person into believing that the broker is a general insurance broker as well as a life insurance broker.

(2) A general insurance broker (not being also a life insurance broker) shall not describe the broker or the broker’s business in a way that would be likely to lead a person into believing that the broker is a life insurance broker as well as a general insurance broker.

(3) A registered insurance broker shall not, after the commencement of this Part, carry on business under a name that would be likely to mislead a person into believing that the broker is an insurer.

Penalty: Imprisonment for 6 months.

31 Brokers to disclose agency

(1) A life insurance broker (not being also a general insurance broker) shall not, as agent of an insurer in respect of general insurance business, do any act, for or in relation to an intending insured, in respect of insurance other than life insurance unless the broker has first informed the intending insured that, in doing that act, the broker would be acting as agent of the insurer and not of the intending insured.

(2) A general insurance broker (not being also a life insurance broker) shall not, as agent of an insurer in respect of life insurance business, do any act, for or in relation to an intending insured, in respect of life insurance unless the broker has first informed the intending insured that, in doing that act, the broker would be acting as agent of the insurer and not of the intending insured.

Penalty: 60 penalty units.

Part IIIA—Registration of Foreign Insurance Agents

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31A Interpretation

If this Act is extended to an external Territory, a reference in a provision of this Part to the commencement of this Part shall, for the purposes of the application of that provision in that Territory, be construed as a reference to the commencement of the day on which this Act was extended to that Territory or the commencement of this Part, whichever is the later.

31B Foreign insurance agents not to carry on business unless registered

(1) A person (whether an individual or a corporation) shall not, after the expiration of 6 months after the commencement of this Part, carry on business as a foreign insurance agent, whether alone or in partnership, unless:

(a) both of the following conditions are satisfied:

(i) the person is a registered insurance broker;

(ii) if there are liabilities prescribed for the purposes of this subparagraph—there is in force an acceptable contract of professional indemnity insurance within the meaning of section 9B; or

(b) both of the following conditions are satisfied:

(i) the person is a registered foreign insurance agent;

(ii) if there are liabilities prescribed for the purposes of this subparagraph—there is in force an acceptable contract of professional indemnity insurance within the meaning of section 9B.

Penalty: Imprisonment for 2 years.

(2) The Commissioner may, by notice in writing served on the registered insurance broker or registered foreign insurance agent concerned, declare that a contract specified in the notice is no longer an acceptable contract of professional indemnity insurance for the purposes of subparagraph (1)(a)(ii) or (b)(ii).

(3) A notice served under subsection (2) has effect on a day specified in the notice, being a day not less than 21 days after service of the notice.

31C Applications for registration

(1) A person who wants to be registered under this Part may apply to the Commissioner accordingly.

(2) The application shall be in accordance with the approved form.

(3) To avoid doubt, an approved form made for the purposes of subsection (2) may include the requirement to provide:

(a) information for statistical purposes; and

(b) information that is, or may be, required to be given to the Commissioner under any other provision of this Act or the regulations.

(4) A person shall not, with intent to deceive:

(a) make a false or misleading statement in, or omit material matter from, an approved form given to the Commissioner under subsection (1); or

(b) give to the Commissioner, in connection with an application under this section, information that is false or misleading in a material particular.

Penalty for contravention of this subsection: Imprisonment for 2 years.

31D Registration of foreign insurance agents

(1) Subject to this section, where an application is made to the Commissioner under section 31C, the Commissioner shall register the applicant, and give the applicant a certificate of registration, if:

(a) the Commissioner is satisfied that the contract requirements of subparagraph 31B(1)(b)(ii) (if applicable) are satisfied in respect of the applicant;

(b) the applicant has paid such fee as is prescribed; and

(c) the applicant has given to the Commissioner a copy of each foreign agency agreement that authorises the applicant to arrange contracts as agent for an insurer.

(2) If:

(a) an applicant, or a director, employee or agent of an applicant has been convicted of an offence referred to in subsection 31H(1); or

(b) an applicant, or a director, employee or agent of an applicant, is bankrupt or insolvent; or

the Commissioner may refuse to register the applicant.

(3) Registration of a person under this section has effect for a period of one year.

(4) If:

(a) a registered foreign insurance agent applies to the Commissioner for cancellation of registration under this section; and

(b) the Commissioner is satisfied that the person is no longer carrying on business as a foreign insurance agent;

the Commissioner may cancel the registration.

(5) Where the Commissioner:

(a) registers an applicant under this section; or

(aa) refuses to renew the registration of an applicant under this section; or

(b) cancels the registration of a registered foreign insurance agent under this section;

the Commissioner shall cause notice of the registration, refusal or cancellation to be published in the Gazette.

31E Register to be kept

(1) For the purposes of this Act, the Commissioner shall cause to be kept a Register of Foreign Insurance Agents.

(2) Subject to this Act and to any regulations, the Register shall be kept in such form and manner as the Commissioner directs.

31F Inspection of documents

A person may, on application made in accordance with the regulations and on payment of the prescribed fee (if any):

(a) inspect the Register of Foreign Insurance Agents;

(b) inspect a contract of insurance referred to in subparagraph 31B(1)(a)(ii) or (b)(ii), or a copy of such a contract, that is lodged with the Commissioner;

(d) inspect any document lodged with the Commissioner under section 31J or 31K; and

(e) make a copy of, or take extracts from, anything that the person is entitled to inspect under any of the preceding paragraphs.

31G Delay in registration or renewal

(1) Where:

(a) an application for registration under section 31C is made before the expiration of 6 months after the commencement of this Part to the Commissioner by a person who was carrying on business as a foreign insurance agent at the commencement of this Part; and

(b) the Commissioner has not refused to register the applicant;

the person is not guilty of an offence under section 31B by so carrying on business as a foreign insurance agent after the expiration of that period of 6 months.

(2) Where:

(a) an application by a registered foreign insurance agent for renewal of registration under section 31C is made to the Commissioner before the expiration of the period of registration; and

(b) the Commissioner has not renewed, or refused to renew the registration;

then, in spite of the expiration of the period of the registration, the agent shall be deemed, for the purposes of this Act and the regulations, to be registered until the Commissioner renews, or refuses to renew, the agent’s registration.

(3) Subsection (1) ceases to apply to a person in relation to carrying on business as a foreign insurance agent if the Commissioner has, by notice in writing to the person, required the person to comply, after such period as is specified in the notice, in relation to that business, with such of the provisions of this Act that are applicable to registered foreign insurance agents as are so specified and the person has failed to comply with any of those provisions as required by the notice.

(4) The Commissioner may, by writing signed by the Commissioner, exempt a person to whom subsection (1) or (2) applies from the requirement to comply, in relation to carrying on business as a foreign insurance agent, with such provisions of this Act (not being provisions with which the person is required to comply in relation to the business concerned because of a notice under subsection (3)) as are specified in the instrument of exemption.

31H Suspension or cancellation of registration

(a) against or arising under this Act or any law, whether of the Commonwealth, of a State or Territory, or of some other country, in respect of conduct relating to insurance; or

(b) in respect of dishonest conduct;

being an offence that, in the opinion of the Commissioner, renders the person unfit to carry on business as a foreign insurance agent.

(1A) If:

(a) a person registered under this Part, or a director, employee or agent of such a person, becomes bankrupt or insolvent; or

(b) a person registered under this Part fails to discharge the ordinary obligations of an insurance intermediary as set out in decision-making principles in force under section 41A;

the Commissioner may:

(d) cancel the registration of the person.

(2) While the registration of a person under this Part is suspended, the person shall be deemed not to be registered under this Part.

(3) Notwithstanding subsection (2), a person whose registration is suspended may carry on such of the person’s business as a foreign insurance agent as the Commissioner, by writing signed by the Commissioner, specifies, for such time and subject to such conditions (if any) as the Commissioner, by writing signed by the Commissioner, specifies.

(4) A person shall not carry on business as a foreign insurance agent after the time specified under subsection (3) or fail to comply with a condition under that subsection that is applicable to the person.

Penalty: Imprisonment for 2 years.

(5) Where the Commissioner cancels the registration of a person, the Commissioner may, by writing signed by the Commissioner, specify a period during which the person is to be disqualified from registration and, where a period is so specified in relation to a person, the person is disqualified from registration during that period.

(6) A person shall not be registered under this Part while the person’s registration is suspended or while the person is disqualified from registration.

31J Annual return

(1) A person who:

(a) has been a registered foreign insurance agent at any time during a particular accounting period of the person; and

(b) during that period, arranged any contract of general insurance as agent for an unauthorised foreign insurer;

Penalty: 30 penalty units.

(2) The return:

(a) must be in an approved form;

(b) must contain such information as is required by the form;

(d) unless paragraph (e) applies—must be lodged within 4 months after the end of the accounting period to which it relates; and

(e) if, before the end of the lodgment period referred to in paragraph (d), the Commissioner grants an extension of the lodgment period—must be lodged within the extended period.

(3) Subsection 31H(2) does not apply for the purposes of this section.

31K Notification of foreign agency agreements

(1) Where:

(a) a foreign agency agreement is entered into in relation to a registered foreign insurance agent; or

(b) a foreign agency agreement in relation to a registered foreign insurance agent (whether entered into before or after the commencement of this section) is altered or terminated;

the agent shall, within 21 days after the agreement is entered into or the alteration or termination occurs:

(c) in the case of the entering into, or the alteration of, an agreement—lodge with the Commissioner a copy of the agreement or of the alteration, as the case may be; or

(d) in the case of the termination of an agreement—notify the Commissioner in writing of the termination.

Penalty: A fine not exceeding 30 penalty units.

(2) Subsection 31H(2) does not apply for the purposes of this section.

Part IV—Miscellaneous

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32 Brokers to give certain information

(1) Where an insurance broker arranges or effects a contract of insurance:

(a) the broker shall, as soon as it is reasonably practicable for the broker to do so, give to the insured particulars in writing of any fees or other amounts charged by the insurance broker in respect of the broker’s services in connection with the contract; and

(b) if requested to do so by the insured, the broker shall, as soon as it is reasonably practicable for the broker to do so, give to the insured particulars of any commission or other remuneration or benefit received by the broker from the insurer in respect of the broker’s services in arranging or effecting the contract.

(2) If an insurance broker who arranges or effects a contract of insurance gives to the insured particulars of any premiums payable, or charges imposed by law, in respect of the contract, the broker shall cause the particulars of fees or other amounts given by the broker to the insured under subsection (1) to be shown separately from particulars of those premiums or charges.

(3) Paragraph (1)(b) does not have effect where the contract of insurance was effected under a binder and the broker has complied with the requirements of section 16.

(4) Where the contract of insurance is one of a number of contracts of insurance arranged or effected by the broker as a group of contracts of insurance, it is sufficient compliance with subsection (1) if the broker gives the required particulars in relation to the group of contracts.

(5) An insurance broker shall, as soon as is reasonably practicable after the broker has arranged or effected a contract of insurance (including a contract of insurance effected by the broker under a binder), inform the insured of the name of the insurer and of a place of business of the insurer.

(6) It is a sufficient compliance with so much of subsection (5) as requires the insurance broker to inform the insured of the name of the insurer if, in relation to a contract of insurance with Lloyd’s underwriters, or with Lloyd’s underwriters and others, the insurance broker informs the insured that the contract was arranged or effected with “Lloyd’s”, or with “Lloyd’s” and other specified insurers, as the case may be.

(7) In subsection (6), Lloyd’s underwriters has the same meaning as it has in the Insurance Act 1973.

Penalty: 60 penalty units.

33 Insurance intermediaries to give certain information

(1) This section applies to an insurance intermediary other than an insurance broker.

(2) Where an insurance intermediary has an authority from 2 or more insurers to arrange or effect contracts of insurance, the insurance intermediary shall, before arranging or effecting a contract of insurance, inform the intending insured of the name of the proposed insurer and of a place of business of the proposed insurer.

(3) An insurance intermediary (other than an intermediary referred to in subsection (2)) who proposes to arrange or effect a contract of insurance shall:

(a) subject to paragraph (b), inform the intending insured, before arranging or effecting the contract, of the name of the proposed insurer and of a place of business of the proposed insurer; or

(b) if it is not practicable for the intermediary to comply with paragraph (a), inform the insured, as soon as reasonably practicable after the intermediary has arranged or effected the contract, of the name of the insurer and of a place of business of the insurer.

(4) It is a sufficient compliance with so much of subsection (2) or (3) as requires the insurance intermediary to inform the intending insured or the insured of the name of the proposed insurer or of the insurer if, in relation to a proposed contract of insurance or a contract of insurance with Lloyd’s underwriters, or with Lloyd’s underwriters and others, the insurance intermediary informs the intending insured or the insured that the contract is to be, or has been, as the case may be, arranged or effected with “Lloyd’s”, or with “Lloyd’s” and other specified insurers, as the case may be.

(5) In subsection (4), Lloyd’s underwriters has the same meaning as it has in the Insurance Act 1973.

(6) If a proposed contract of insurance is to be arranged or effected, or a contract of insurance has been arranged or effected, by an insurance intermediary through another insurance intermediary (including another insurance intermediary who is an insurance broker), this section applies as if the proposed contract were to be arranged or effected, or the contract of insurance had been arranged or effected, as the case may be, by the first-mentioned insurance intermediary otherwise than through the other insurance intermediary.

Penalty: Imprisonment for 2 years.

33A Insurance intermediaries to notify insurers of multiple agency arrangements

(1) This section applies to an insurance intermediary other than an insurance broker.

(2) If, when this section commences, an insurance intermediary is the agent of more than one insurer, the intermediary must, within 60 days after this section commences, give written notice to each insurer of the name of each other insurer.

(3) If an insurance intermediary:

(a) is the agent of an insurer (an existing principal); and

(b) proposes to enter into an agency agreement with another insurer (the intended principal);

the intermediary must not enter that agreement unless:

(d) the intended principal is given written notice of the name of each existing principal.

(4) If an insurance intermediary:

(a) is the agent of more than one insurer (the existing principals); and

(b) proposes to renew or cancel one of the agency agreements concerned;

the intermediary must not renew or cancel that agreement until each existing principal (other than the principal with whom the agreement is to be cancelled or renewed) is given written notice of that intention.

(5) If an insurance intermediary:

(a) is the agent of more than one insurer (the existing principals); and

(b) one of the agency agreements concerned expires or is terminated by force of the agreement or at the initiative of one of the existing principals;

the intermediary must, within 7 days of the expiration or termination of that agreement, give written notice to each other existing principal of that expiration or termination.

Penalty: 50 penalty units.

34 Insurance intermediary to notify insured if insurer is an unauthorised foreign insurer

(1) Where:

(a) a contract of general insurance is arranged or effected by an insurance intermediary;

(b) the insurer, or any of the insurers, under the contract is an unauthorised foreign insurer; and

(c) the insurance intermediary did not obtain an acknowledgment in the approved form from the appropriate person, given in the approved manner and within the required time;

the insurance intermediary is guilty of an offence punishable, on conviction, by imprisonment for not more than 2 years:

(e) in the case of a corporation—by a fine not exceeding $5,000.

(2) In subsection (1):

appropriate person means:

(a) if the regulations provide for the acknowledgment to be given by a person on behalf of the insured—that person; or

(b) in any other case—the insured.

required time means:

(a) if it is practicable for the acknowledgment to be obtained before the contract is arranged or effected—the time when the contract is arranged or effected; or

(b) in any other case—as soon as reasonably practicable after the contract is arranged or effected.

(3) A reference in this section to the approved manner is a reference to the manner specified in a written instrument made by the Commissioner for the purposes of this subsection.

(3A) An instrument under subsection (3) is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.

(4) If a proposed contract of insurance is to be arranged or effected, or a contract of insurance has been arranged or effected, by an insurance intermediary through another insurance intermediary (including another insurance intermediary who is an insurance broker), this section applies as if the proposed contract were to be arranged or effected, or the contract of insurance had been arranged or effected, as the case may be, by the first-mentioned insurance intermediary otherwise than through the other insurance intermediary.

34A Commissioner may direct an insurance intermediary to provide information

(1) If, in the Commissioner’s opinion, an insurance intermediary:

(a) has not met the ordinary obligations of an insurance intermediary as set out in decision-making principles in force under section 41A; or

(b) is not meeting those obligations; or

the Commissioner may direct an insurance intermediary, or a director, employee or agent of the insurance intermediary, to do all or any of the following:

(d) to provide the Commissioner with such information as the Commissioner requires;

(e) to attend and give evidence before the Commissioner or an authorised officer;

(f) to produce to the Commissioner any documents in the custody or under the control of the person;

for the purpose of enabling the Commissioner to investigate all or any of the matters mentioned in paragraphs (a), (b) and (c).

(2) The Commissioner may direct that:

(a) the information or answers to questions be given either orally or in writing; and

(b) the information or answers to questions be verified or given on oath or affirmation.

(3) The Commissioner or an authorised officer may administer the oath or affirmation.

(4) The oath to be taken or affirmation to be made by a person for the purposes of this section is an oath or affirmation that the information or answers the person will give will be true.

(5) The regulations may prescribe scales of expenses to be allowed to persons who are required to attend under this section.

(6) If:

(a) information is provided to the Commissioner under paragraph (1)(d) in a document; or

(b) evidence is given to the Commissioner under paragraph (1)(e) in a document; or

the Commissioner may inspect, audit, examine, make copies of, or take extracts from any such document.

(7) A person must not, without reasonable excuse, fail to comply with a requirement under subsection (1).

Penalty: 30 penalty units.

(8) It is a reasonable excuse for a person to refuse or fail to provide information, to answer a question or to produce a document on the ground that to do so would tend to incriminate the person.

(9) A person must not, intentionally or recklessly:

(a) make a statement to the Commissioner or an authorised officer, either orally or in writing, that is false or misleading in a material particular; or

(b) present a document to the Commissioner or an authorised officer that is false or misleading in a material particular.

Penalty: Imprisonment for 1 year.

(10) If documents are produced to the Commissioner:

(a) the Commissioner may retain possession of the documents for such period as is necessary and reasonable for the purposes of the investigation; and

(b) during that period the Commissioner must permit a person who would be entitled to inspect a document if it were not in the Commissioner’s possession to inspect that document at any reasonable time.

34B Production of documents

(1) The Commissioner may, by written notice, require an insurance intermediary or a director, employee or agent of the insurance intermediary to produce any information or documents kept by the insurance intermediary for the purpose of carrying on business as an insurance intermediary.

(2) If:

(a) information is provided to the Commissioner under subsection (1) in a document; or

(b) documents are produced to the Commissioner under that subsection;

the Commissioner may inspect, audit, examine, make copies of, or take extracts from any such document.

(3) A person must not, without reasonable excuse, fail to comply with a requirement under subsection (1).

Penalty: 30 penalty units.

(4) It is a reasonable excuse for a person to refuse or fail to produce a document on the ground that to do so would tend to incriminate the person.

34C Identity cards

(1) The Commissioner may issue to each authorised officer an identity card.

(2) An identity card must:

(a) be in an approved form; and

(b) incorporate a recent photograph of the person.

(3) As soon as practicable after a person ceases to be an authorised officer, he or she must return his or her identity card to the Commissioner.

(4) A person must not, without reasonable excuse, fail to return his or her identity card.

Penalty: One penalty unit.

34D Offence powers—entry and search of premises with occupier’s consent

(1) If:

(a) an authorised officer has reasonable grounds for suspecting that there is on or in any premises a particular thing, including information, that may afford evidence of the commission of an offence against this Act; and

(b) the occupier of the premises consents to the officer entering the premises;

the officer may, after producing his or her identity card for inspection by the occupier:

(d) search the premises for the thing; and

(e) seize the thing; and

(f) if the thing is or includes information in a written or electronic form—do the things set out in subsections (2), (3) and (4) in respect of the thing.

(2) If the thing referred to in subsection (1) is or includes information in a written or electronic form, an authorised officer may operate equipment at the premises to see whether:

(a) the equipment; or

(b) a disk, tape or other storage device that:

(i) is at the premises; and

(ii) can be used with or is associated with the equipment;

contains the information.

(3) If an authorised officer, after operating equipment at the premises, finds that the equipment, or that a disk, tape or other storage device at the premises, contains the information, he or she may:

(a) seize the equipment or the disk, tape or other storage device; or

(b) if the information can, by using facilities at the premises, be put in documentary form—operate the facilities to put the information in that form and seize the documents so produced; or

(i) is brought to the premises; or

(ii) is at the premises and the use of which for the purpose has been agreed to in writing by the occupier of the premises;

operate the equipment or other facilities to copy the information to the storage device and remove the storage device from the premises.

(4) An authorised officer may seize equipment under paragraph (3)(a) only if:

(a) it is not practicable to put the information in documentary form as mentioned in paragraph (3)(b) or to copy the information as mentioned in paragraph (3)(c); or

(b) possession of the equipment by the occupier of the premises could constitute an offence.

(5) If, in the course of searching for a particular thing:

(a) an authorised officer finds a thing that he or she believes, on reasonable grounds to be another thing that will afford evidence as to the commission of an offence against this Act; and

(b) he or she believes on reasonable grounds, that it is necessary to seize that thing:

(i) in order to prevent its concealment, loss or destruction, or its use in committing, continuing or repeating an offence against this Act; and

(ii) without the authority of a warrant under section 34E because the circumstances are so serious and urgent;

he or she may seize that thing.

(6) The authorised officer must leave the premises if the occupier asks the authorised officer to do so.

34E Offence-related warrants

(1) An authorised officer may apply to a magistrate for a warrant under this section in relation to particular premises.

(2) Subject to subsection (3), a magistrate may issue the warrant if satisfied, by information on oath or affirmation, that there are reasonable grounds for suspecting that there is on the premises a particular thing, including information, that may afford evidence of the commission of an offence against this Act.

(3) A magistrate must not issue the warrant unless the authorised officer or someone else has given the magistrate, either orally (on oath or affirmation) or by affidavit, any further information the magistrate may require about the grounds on which the issue of the warrant is being sought.

(4) The warrant must:

(a) authorise any authorised officer named in the warrant, with such assistance and by such force as is necessary and reasonable:

(i) to enter the premises; and

(ii) to search the premises for the thing; and

(iii) to seize the thing; and

(iv) if the thing is or includes information in a written or electronic form—to do the things set out in subsections (5), (6) and (7) in respect of the thing; and

(b) state whether the entry is authorised to be made at any time of the day or night or during specified hours of the day or night; and

(c) specify the day (not more than 7 days after the issue of the warrant) on which the warrant ceases to have effect; and

(d) state the offence in respect of which the warrant is issued.

(5) If the thing referred to in subsection (2) is or includes information in a written or electronic form, an authorised officer acting under the warrant may operate equipment at premises referred to in the warrant to see whether:

(a) the equipment; or

(b) a disk, tape or other storage device that:

(i) is at the premises; and

(ii) can be used with or is associated with the equipment;

contains the information.

(6) If an authorised officer acting under the warrant, after operating equipment at the premises, finds that the equipment contains the information or that a disk, tape or other storage device at the premises contains the information, he or she may:

(a) seize the equipment or the disk, tape or other storage device; or

(b) if the information can, by using facilities at the premises, be put in documentary form—operate the facilities to put the information in that form and seize the documents so produced; or

(i) is brought to the premises; or

(ii) is at the premises and the use of which for the purpose has been agreed to in writing by the occupier of the premises;

operate the equipment or other facilities to copy the information to the storage device and remove the storage device from the premises.

(7) An authorised officer acting under the warrant may seize equipment under paragraph (6)(a) only if:

(a) it is not practicable to put the relevant information in documentary form as mentioned in paragraph (6)(b) or to copy the information as mentioned in paragraph (6)(c); or

(b) possession of the equipment by the occupier of the premises could constitute an offence.

(8) If, in the course of searching for a particular thing in relation to a particular offence, an authorised officer acting under the warrant finds another thing that the officer believes, on reasonable grounds, to be:

(a) a thing that will afford evidence as to the commission of an offence (although not the thing specified in the warrant); or

(b) a thing that will afford evidence as to the commission of another offence against this Act;

and the officer believes, on reasonable grounds, that it is necessary to seize that thing in order to prevent its concealment, loss or destruction, or its use in committing, continuing or repeating the offence or the other offence, the warrant is to be taken to authorise the officer to seize that thing.

34F Announcement before entry under warrant

(1) The authorised officer named in a warrant issued under section 34E must, before any person enters premises under the warrant:

(a) announce that he or she is authorised by the warrant to enter the premises; and

(b) give any person at the premises an opportunity to allow entry to the premises.

(2) The authorised officer is not required to comply with subsection (1) if he or she believes on reasonable grounds that immediate entry to the premises is required to ensure that the effective execution of the warrant is not frustrated.

34G Details of warrant to be given to occupier etc.

(1) If a warrant issued under section 34E is being executed and the occupier of the premises is present at the premises, the authorised officer named in the warrant must make available to that person a copy of the warrant.

(2) The authorised officer must identify himself or herself to the person at the premises.

(3) The copy of the warrant need not include the signature of the magistrate who issued the warrant.

34H Continuance of warrants in certain circumstances

(1) If a warrant issued under section 34E is being executed, the authorised officer named in the warrant and any officers assisting that officer may, if the warrant is still in force, complete the execution of the warrant after temporarily ceasing its execution and leaving the premises:

(a) for not more than one hour; or

(b) for a longer period if the occupier of the premises consents in writing.

(2) If:

(a) the execution of a warrant is stopped by an order of a court; and

(b) the order is later revoked or reversed on appeal; and

the execution of the warrant may be completed.

34J Use of expert assistance in executing warrants

(1) If the authorised officer named in a warrant issued under section 34E believes on reasonable grounds that:

(a) evidential material may be accessible by operating electronic equipment at the premises to which the warrant relates; and

(b) expert assistance is required to operate the equipment; and

(c) if he or she does not take action under this subsection, the material may be destroyed, altered or otherwise interfered with;

he or she may do whatever is necessary to secure the equipment, whether by locking it up, placing a guard or otherwise.

(2) The authorised officer must give notice to the occupier of the premises of his or her intention to secure equipment and of the fact that the equipment may be secured for up to 24 hours.

(3) The equipment may be secured:

(a) for a period not exceeding 24 hours; or

(b) until the equipment has been operated by the expert;

whichever happens first.

(4) If the authorised officer believes on reasonable grounds that the expert assistance will not be available within 24 hours, he or she may apply to a magistrate for an extension of that period.

(5) The authorised officer must give notice to the occupier of the premises of his or her intention to apply for an extension, and the occupier is entitled to be heard in relation to the application.

(6) The provisions of section 34E relating to the issue of a warrant apply, with such modifications as are necessary, to the issuing of an extension.

34K Warrants may be granted by telephone etc.

(1) If, because of circumstances of urgency, an authorised officer thinks it necessary to do so, the officer may apply for a warrant under section 34E by telephone, telex, facsimile or other electronic means under this section.

(2) Before making such an application, an authorised officer must prepare information of the kind mentioned in subsection 34E(2) that sets out the grounds on which the issue of the warrant is being sought, but may, if it is necessary to do so, make the application before the information has been sworn.

(3) If a magistrate to whom an application under this section is made is satisfied:

(a) after having considered the terms of the information prepared under subsection (2); and

(b) after having received any further information that the magistrate may require about the grounds on which the issue of the warrant is being sought;

that there are reasonable grounds for issuing the warrant, the magistrate must complete and sign a warrant that is the same as the warrant that the magistrate would issue under section 34E if the application had been made under that section.

(4) If a magistrate signs a warrant under subsection (3):

(a) the magistrate must inform the authorised officer of the terms of the warrant, the day and time when it was signed, and the day on which it ceases to have effect, and record on the warrant the reasons for issuing it; and

(b) the officer must complete a form of warrant in the terms given to the officer by the magistrate and write on it the magistrate’s name and the day and time when the warrant was signed.

(5) If an authorised officer completes a form of warrant, the officer must, not later than the day after:

(a) the day on which the warrant ceases to have effect; or

(b) the day on which the warrant is executed;

whichever happens first, send the magistrate who signed the warrant the form of warrant completed by the officer and the information duly sworn in connection with the warrant.

(6) Upon receipt of the documents mentioned in subsection (5), the magistrate must attach to them the warrant signed by the magistrate and deal with the documents in the same way that the magistrate would have dealt with the information if the application for the warrant had been made under section 34E.

(7) The form of warrant completed by an authorised officer under subsection (4) is, if it is in accordance with the terms of the warrant signed by the magistrate, authority for any entry, search, seizure or other exercise of a power that the warrant so signed had authorised.

(8) If:

(a) in any proceedings, the court must be satisfied that an entry, search, seizure, or other exercise of power, was authorised under this section; and

(b) the warrant signed by a magistrate under this section authorising the entry, search, seizure, or other exercise of power, is not produced in evidence;

the court must assume (unless the contrary is proved) that the entry, search, seizure, or other exercise of power, was not authorised by such a warrant.

34L Discovery of evidence

(1) If:

(a) an authorised officer who enters premises under section 34D finds the thing (the evidence) which the officer entered the premises to find; and

(b) the officer seizes the evidence;

the officer:

(d) if proceedings are instituted within 60 days after the seizure and the evidence may be used in the proceedings—may keep the evidence so seized until the proceedings (including any appeal to a court in relation to the proceedings) are terminated; and

(e) must allow it to be inspected at any reasonable time by anyone who would be entitled to inspect it if it were not in the officer’s possession.

(1A) If:

(a) an authorised officer who enters premises under a warrant under section 34E finds the thing (the evidence) which the officer entered the premises to find; and

(b) the officer seizes the evidence;

then:

(i) the reason for its seizure no longer exists; or

(ii) a decision is made not to use it in evidence;

unless the evidence is forfeited or forfeitable to the Commonwealth or is the subject of a dispute as to ownership; and

(d) the officer must allow it to be inspected at any reasonable time by anyone who would be entitled to inspect it if it were not in the officer’s possession.

(2) If, in the course of searching premises entered under section 34D or under a warrant under section 34E, the authorised officer:

(a) finds a thing that he or she believes, on reasonable grounds, to be:

(i) a thing (other than the evidence mentioned in whichever of subsections (1) and (1A) is applicable) that will afford evidence of the commission of the offence in relation to which the search was undertaken; or

(ii) a thing that will afford evidence of the commission of another offence against this Act; and

(b) the officer believes, on reasonable grounds, that it is necessary to seize the thing to prevent its concealment, loss or destruction;

subsection (1) or (1A), as the case may be, applies to the thing as if it were the evidence mentioned in that subsection.

(3) An authorised officer may apply to a magistrate to extend the periods of time referred to in paragraphs (1)(c) and (d).

(4) The magistrate may extend the periods of time for so long as the magistrate considers necessary.

34M Compensation for damage to electronic equipment

(1) If:

(a) damage is caused to equipment as a result of it being operated as mentioned in section 34D or 34E; and

(b) the damage was caused as a result of:

(i) insufficient care being exercised in selecting the person who was to operate the equipment; or

(ii) insufficient care being exercised by the person operating the equipment;

compensation for the damage is payable to the owner of the equipment.

(2) Compensation is payable out of money appropriated by the Parliament for the purpose.

(3) In determining the amount of compensation payable, regard is to be had to whether the occupier of the premises and his or her employees and agents, if they were available at the time, had provided any warning or guidance as to the operation of the equipment that was appropriate in the circumstances.

34N Copies of seized things to be provided

(1) Subject to subsection (2), if an authorised officer seizes under section 34D or 34E:

(a) a document, film, computer file or other thing that can be readily copied; or

(b) a storage device the information in which can be readily copied;

the officer must, if requested to do so by the occupier of the premises, give a copy of the thing or the information to the person as soon as practicable after the seizure.

(2) Subsection (1) does not apply if:

(a) the thing that has been seized was seized under paragraph 34D(3)(b) or (c) or 34E(6)(b) or (c); or

(b) possession by the occupier of the document, film, computer file, thing or information could constitute an offence.

34P Power to require persons to provide information etc.

(1) If an authorised officer is on or in premises because the occupier of the premises consented to the officer’s entry—the officer may direct the occupier to:

(a) answer any questions put by the officer; and

(b) produce any records or documents requested by the officer.

(2) An authorised officer who is on or in any premises that he or she has entered under a warrant may require any person on or in the premises to:

(a) answer any questions put by the officer; and

(b) produce any records or documents requested by the officer.

(3) A person must not, without reasonable excuse, fail to comply with a requirement under subsection (2).

Penalty: 30 penalty units.

(4) It is a reasonable excuse for a person to refuse or fail to provide information, to answer a question or to produce a document on the ground that to do so would tend to incriminate the person.

(5) A person must not, intentionally or recklessly:

(a) make a statement to an authorised officer, either orally or in writing, that is false or misleading in a material particular; or

(b) present a document to an authorised officer that is false or misleading in a material particular.

Penalty: Imprisonment for 1 year.

34Q Consent

(1) Before obtaining the consent of a person for the purposes of section 34D, the authorised officer must inform that person that he or she may refuse to give consent.

(2) An entry by an authorised officer by virtue of the consent of a person is not lawful unless the person voluntarily consented to the entry.

34R Persons to assist authorised officers

(1) An authorised officer may request the occupier of any premises entered:

(a) by the officer under section 34D; or

(b) under a warrant under section 34E;

to provide reasonable assistance to the officer, at any time while the officer is entitled to remain on the premises, for the purpose of the exercise of the officer’s powers under those sections in relation to the premises.

(2) A person mentioned in subsection (1) must not, without reasonable excuse, fail to comply with an authorised officer’s request.

Penalty: 30 penalty units.

(3) It is a reasonable excuse for a person whose premises are being searched under a warrant issued under section 34E to refuse to assist an authorised officer on the ground that to do so would tend to incriminate the person.

34S Offence for making false statements in applications for warrants

A person must not make, in an application for a warrant, a statement that the person knows to be false or misleading in a material particular.

Penalty: Imprisonment for 2 years.

34T Offences relating to telephone warrants

A person must not:

(a) state in a document that purports to be a form of warrant under section 34E the name of a magistrate unless that magistrate issued the warrant; or

(b) state on a form of warrant under that section a matter that, to the person’s knowledge, departs in a material particular from the form authorised by the magistrate who issued the warrant; or

(c) purport to execute, or present to a person, a document that purports to be a form of warrant under that section that the person knows:

(i) has not been approved by a magistrate under that section; or

(ii) departs in a material particular from the terms authorised by a magistrate under that section; or

(d) give a magistrate a form of warrant under that section that is not the form of warrant that the person purported to execute.

Penalty: Imprisonment for 2 years.

34U Secrecy

(1) In this section:

compliance officer means:

(a) a person who is a member of the staff referred to in subsection 13(1) of the Insurance and Superannuation Commissioner Act 1987; or

(b) a person who is engaged under subsection 13(3) of the Insurance and Superannuation Commissioner Act 1987; or

(i) has acquired protected information; or

(ii) has had access to protected documents;

other than a member or officer of, or a person employed or engaged by:

(iii) a financial sector supervisory agency; or

(iv) an overseas financial sector supervisory agency; or

(v) a law enforcement agency.

court includes a tribunal, authority or person having the power to require the production of documents or the answering of questions.

financial sector supervisory agency means a person or body declared by the regulations to be a financial sector supervisory agency for the purposes of this section.

law enforcement agency means a person or body declared by the regulations to be a law enforcement agency for the purposes of this section.

overseas financial sector supervisory agency means a person or body declared by the regulations to be an overseas financial sector supervisory agency for the purposes of this section.

produce includes permit access to.

protected document means a document given or produced (whether before or after the commencement of this section) under, or for the purposes of, this Act and containing information relating to the affairs of a person other than information that has already been lawfully made available to the public from other sources.

protected information means information disclosed or obtained (whether before or after the commencement of this section) under, or for the purposes of, this Act and relating to the affairs of a person other than information that has already been lawfully made available to the public from other sources.

(2) Subject to this section, a person who is or has been a compliance officer must not, except for the purposes of this Act or any other Act of which the Commissioner has the general administration, directly or indirectly:

(a) disclose to any person, or to a court, any protected information acquired by the first-mentioned person in the course of his or her duties as a compliance officer; or

(b) produce to any person, or to a court, a protected document.

Penalty: Imprisonment for 2 years.

Note: Subsection 4B(2) of the Crimes Act 1914 allows a court to impose an appropriate fine instead of, or in addition to, a term of imprisonment.

(3) Subsection (2) does not prohibit a person from disclosing protected information, or producing a protected document, relating to the affairs of another person if the other person agrees in writing to the disclosure of the information or the production of the document, as the case may be.

(4) Subsection (2) does not prohibit a person from disclosing protected information, or producing a protected document, to:

(a) the Treasurer, the Secretary to the Department or an officer of the Department authorised by the Secretary to the Department for the purposes of this section; or

(b) a court for the purposes of this Act or any other Act of which the Commissioner has the general administration; or

(c) a financial sector supervisory agency for the purposes of the performance of any of its functions or the exercise of any of its powers; or

(d) an overseas financial sector supervisory agency for the purposes of the performance of any of its functions or the exercise of any of its powers; or

(e) if the Treasurer states in writing that, in his or her opinion, it is in the public interest that the information be disclosed or the document be produced to a particular person—that person; or

(f) if the Treasurer states in writing that, in his or her opinion, it is in the public interest that the information be disclosed or the document be produced to members of the publica member of the public.

(5) Subsection (2) does not prohibit a person from disclosing protected information, or producing a protected document, to:

(a) a law enforcement agency; or

(b) a member of the staff referred to in subsection 13(1) of the Insurance and Superannuation Commissioner Act 1987; or

(6) A person who is or has been a compliance officer may only disclose protected information, or produce a protected document, to a law enforcement agency for the purposes of the performance by the agency of its functions in relation to an offence or alleged offence against a law of the Commonwealth, of a State or of a Territory.

(7) A person who is or has been compliance officer may only disclose protected information, or produce a protected document, to a person referred to in paragraph (5)(b) or (c) for the purposes of the performance of the Commissioner’s functions, or the exercise of the Commissioner’s powers, under a law of the Commonwealth.

(8) Paragraphs (4)(e) and (f) do not authorise the disclosure of information, or the production of a document, relating to the personal affairs of an individual if the disclosure or production, as the case requires, would be unreasonable in the circumstances.

(9) Subsection (2) does not prohibit a person from disclosing information, or producing a document, if the information, or the information contained in the document, as the case may be, is in the form of a summary or collection of information that is so prepared that information relating to any particular person cannot be found out from it.

(10) A person who is or has been a compliance officer cannot be required to disclose to a court any protected information, or to produce in a court a protected document, except when it is necessary to do so for the purposes of this Act or any other Act of which the Commissioner has the general administration.

(11) If protected information is disclosed, or a protected document is produced, under paragraph (4)(a), to the Secretary to the Department or to an officer of the Department, the Secretary or officer must not, except for the purpose of advising the Treasurer in connection with the administration of this Act, directly or indirectly make a record of, or disclose to any person, the information, or the information contained in the document, as the case may be.

Penalty: Imprisonment for 2 years.

Note: Subsection 4B(2) of the Crimes Act 1914 allows a court to impose an appropriate fine instead of, or in addition to, a term of imprisonment.

(12) A document that:

(a) is a protected document; or

(b) contains protected information;

is an exempt document for the purposes of section 38 of the Freedom of Information Act 1982.

(13) At the end of 5 years after the commencement of this section, the definitions of financial sector supervisory agency, law enforcement agency and overseas financial sector supervisory agency in subsection (1), and subsections (4), (5), (6), (7), (8) and (11), are taken to be repealed.

35 Restrictions as to receipt and payment of remuneration

(1) An insurance broker shall not receive from an insurer or from a person on behalf of an insurer a gift, gratuity, benefit or other reward (however described) except as remuneration for services rendered to the insurer:

(a) in arranging or effecting a particular contract of insurance;

(b) in connection with dealing with or settling a claim under a particular contract of insurance; or

(c) otherwise than in connection with the broker arranging or effecting contracts of insurance or dealing with or settling claims under contracts of insurance.

(2) An insurer shall not pay to an insurance broker, and an insurance broker shall not receive from an insurer, in respect of the arranging or effecting of contracts of insurance by that insurance broker with the insurer, remuneration at a rate or on a basis that has been varied having regard to any one or more of the following:

(a) the number of contracts so arranged or effected;

(b) the total amount of premiums paid or payable under such contracts;

(3) Neither subsection (1) nor (2) has effect in relation to contracts of insurance effected under a binder or in relation to claims dealt with or settled under a binder, as the case may be, if the broker has complied with the requirements of section 16 or 17, as the case may be.

Penalty: Imprisonment for 1 year.

36 Insurance claims moneys

Moneys paid or payable to an insurance broker under a contract of insurance indemnifying the broker in respect of any liability to an insurer, insured or intending insured are not:

(a) in the event of the broker becoming an insolvent under administration or an insolvent company under administration; or

(b) in the event of the estate of the broker being administered under Part XI of the Bankruptcy Act 1966 or under the law of an external Territory providing for the administration of insolvent estates of deceased persons;

available for division among the creditors of the broker generally but shall be paid to the person whose claim against the broker was subject to the indemnity under the contract of insurance.

37 Certain money to be trust money

(1) Moneys paid to a person (not being a registered insurance broker) as agent of an insurer, being moneys paid in relation to a contract of insurance or proposed contract of insurance, are subject to a trust in favour of the insurer and are not capable of being attached or otherwise taken in execution or of being made subject to a set-off, charge or charging order or to any process of a like nature.

(1A) If money referred to in subsection (1) is paid to a person (the sub-agent) who is the agent of an insurance agent, the money is taken to have been paid to the insurance agent at the time when it is received by the sub-agent, whether or not the sub-agent acted within the scope of authority granted by the agent.

(2) Where the contract of insurance was arranged by the person and the moneys constitute the first payment made in relation to the contract, then, unless the moneys are paid by cheque payable to the insurer, the person shall, as soon as is reasonably practicable:

(a) give a receipt for the moneys to the person by whom they were paid; and

(b) state on the receipt the name and a place of business of the insurer.

(2A) Subject to subsections (2C) and (2D), if money referred to in subsection (1) is paid to the person as a premium under a contract of insurance or a proposed contract of insurance, the person must pay the money to the insurer not more than 37 days after the day on which the money is received.

(2B) Subject to subsections (2C) and (2D), if money referred to in subsection (1) is paid as an instalment of a premium under a contract of insurance or a proposed contract of insurance, the person must pay the money to the insurer not more than 37 days after the day on which the money is received.

(2C) If, at the time when money referred to in subsection (1) is received on behalf of an insurer in respect of insurance business, the person is, under section 37A, exempt from the requirements of subsections (2A) and (2B) so far as that insurer and that insurance business are concerned, that money need not be paid to the insurer within the time limits specified in those subsections but must be paid to the insurer as soon as is reasonably practicable.

(2D) If the person ceases to be exempt from the requirement of subsections (2A) and (2B) so far as a particular class of insurer and particular insurance business are concerned:

(a) any money received by the person on behalf of that insurer in respect of that insurance business before the day on which the person ceased to be so exempt must be paid to the insurer within 30 days after that day; and

(b) any money applied in settlement of a claim against the insurer before the day on which the person ceased to be so exempt is to be treated, for the purposes of paragraph (a), to have been paid to the insurer when it was so applied.

(3) If:

(a) money referred to in subsection (2A) or (2B) is paid to the person; and

(b) the money is paid by cheque (other than a cheque payable to the insurer);

the money is taken to have been paid to the person when the cheque was received by the person.

(3A) Moneys referred to in subsection (2A), (2B), (2C) or (2D) may be reduced by:

(a) where the contract concerned is a contract of general insurance—any amounts due to the person pursuant to an agreement with the insurer; or

(b) in any other case—any amounts due to the person pursuant to an agreement with the insurer, other than an agreement in force under section 10.

(3B) Where, before the person has been paid an amount as described in subsection (1), the person has paid to the insurer an amount on account of the first-mentioned amount, the moneys referred to in subsection (2A), (2B), (2C) or (2D) shall be reduced by the amount so paid to the insurer.

(4) An act done in contravention of subsection (2), (2A), (2B), (2C) or (2D) constitutes an offence against that subsection notwithstanding that it was done with the consent of the insurer.

Penalty: Imprisonment for 2 years.

37A Commissioner may grant exemptions from certain requirements under section 37

(1) An insurance intermediary who is the agent of an insurer in respect of a class of insurance business may apply to the Commissioner to be granted an exemption from the requirements of subsections 37(2A) and (2B) in respect of money received in relation to contracts of insurance with that insurer in respect of a class of insurance business to which the agency agreement relates.

(2) An insurance intermediary is not entitled to be granted such an exemption in relation to an insurer and a class of insurance business unless the Commissioner is satisfied:

(a) that the intermediary will be acting under a binder given by the insurer in respect of the insurance business; and

(b) that the nature of the business of the intermediary is such that it is not commercially practicable for the intermediary to comply with the requirements of subsections 37(2A) and (2B); and

(3) An application by an insurance intermediary for an exemption in relation to an insurer and a class of insurance business must:

(a) be made in writing; and

(b) be in an approved form; and

(i) particulars of the binder given by the insurer; and

(ii) a statement of the reasons why the intermediary contends that the relationship between the intermediary and the insurer is such that it is not commercially practicable to comply with the requirements of subsections 37(2A) and (2B); and

(iii) such other particulars as the approved form requires; and

(d) be accompanied by:

(i) a copy of the agency agreement with the insurer; and

(ii) a statement by the insurer to the effect that the insurer has no objection to the grant of the exemption.

(4) If the Commissioner decides, having regard to the application and to the accompanying documents, to grant the insurance intermediary the exemption sought:

(a) the Commissioner must inform the insurance intermediary:

(i) of the granting of the exemption and of the date on which it is granted; and

(ii) of any terms and conditions to which the exemption is subject; and

(b) the Commissioner must, as soon as practicable, notify the granting of the exemption, in relation to the insurer and insurance business in the Gazette.

(5) If the Commissioner decides, having regard to the application and to the accompanying documents, not to grant the exemption, the Commissioner must inform the insurance intermediary of the Commissioner’s decision and of the reasons for that decision.

(6) An exemption granted to an insurance intermediary in respect of an insurer and a class of insurance business applies to all money received by the intermediary on behalf of that insurer in respect of that business on or after the day it is granted and while it remains in force.

(7) The Commissioner may, by notice in writing, revoke an exemption granted to an insurance intermediary in respect of a particular insurer and particular insurance business:

(a) if:

(i) the intermediary, or a director, employee or agent of the intermediary, has, whether before or after the grant of the exemption and whether before or after the commencement of this section, been convicted of an offence against this Act or against any other law, whether of the Commonwealth, of a State or Territory, or of another country, in respect of conduct relating to insurance;

(ii) the Commissioner is of the opinion that the offence renders the intermediary unfit to be exempt from the requirements of subsections 37(2A) and (2B); or

(b) if the intermediary, or a director, employee or agent of the intermediary, becomes bankrupt or insolvent; or

(c) if the intermediary ceases to be an agent of the insurer, or ceases to be an agent of the insurer in respect of that class of business; or

(d) if the insurer indicates to the Commissioner that it no longer consents to the intermediary being so exempted; or

(e) if, for any other reason, the Commissioner considers it no longer appropriate for the intermediary to continue to be so exempted.

(8) If the Commissioner revokes the exemption of an insurance intermediary in relation to a particular insurer, and a particular class of insurance business:

(a) the Commissioner must inform the insurance intermediary of the revocation and of the reasons for the revocation; and

(b) the Commissioner must, as soon as practicable, notify that revocation in the Gazette.

38 Broker to notify insured of association with insurer

(1) Where:

(a) an insurance broker, or a director, employee or agent of an insurance broker, proposes to arrange or effect a contract of insurance; and

(b) a proposed insurer under the proposed contract is associated with the insurance broker;

the insurance broker shall:

(c) subject to paragraph (d), inform the intending insured, before the proposed contract is arranged or effected, of the existence and nature of the association; or

(d) if it is not practicable for the broker to comply with paragraph (c) in relation to the proposed contract, inform the insured, as soon as is reasonably practicable after the contract has been arranged or effected, of the existence and nature of the association.

(2) An insurance broker shall be taken to be associated with an insurer for the purposes of this section if:

(a) the insurance broker, or a director, employee or agent of the insurance broker or of a corporation that is related to the insurance broker, is a director or employee of the insurer or of a corporation that is related to the insurer;

(b) the insurer, or a director, employee or agent of the insurer or of a corporation that is related to the insurer, is a director or employee of the insurance broker or of a corporation that is related to the insurance broker;

(c) the insurance broker or a corporation that is related to the insurance broker, or a director of the insurance broker or of such a corporation, has a beneficial interest in any share or stock in the capital of the insurer or of a corporation that is related to the insurer; or

(d) the insurer or a corporation that is related to the insurer, or a director of the insurer or of such a corporation, has a beneficial interest in any share or stock in the capital of the insurance broker or of a corporation that is related to the insurance broker.

(3) The question whether corporations are related to each other for the purposes of this section is determined in the same way as the question whether bodies corporate are related bodies corporate would be determined under Division 6 of Part 1.2 of Chapter 1 of the Corporations Law if, in section 46 of that law:

(a) the reference to a body corporate that is in a position to cast, or control the casting of, more than one-half of the maximum number of votes that might be cast at a general meeting of another body corporate were a reference to a body corporate that is in a position to cast, or control the casting of, more than one-quarter of that number of votes; and

(b) the reference to a body corporate holding more than one-half of the issued share capital of another body corporate were a reference to a body corporate holding more than one-quarter of the issued share capital of another body corporate.

(4) This section has effect notwithstanding anything in the Insurance Act 1973 or the Life Insurance Act 1995.

(5) This section has effect only after the expiration of 6 months after the commencement of Part III or, in an external Territory to which this Act extends, only after the expiration of 6 months after the commencement of the day on which this Act commences to extend to that Territory or the commencement of Part III, whichever is the later.

Penalty: 60 penalty units.

39 Misdescription by insurance intermediaries

(1) An insurance intermediary other than a registered insurance broker must not describe the intermediary or the intermediary’s business in a way that would be likely to lead a person into believing that the intermediary is an insurance broker.

(2) An insurance intermediary must not describe the intermediary or the intermediary’s business in a way that would be likely to mislead a person into believing that the intermediary is an insurer.

(3) This section has effect only after the expiration of 6 months after the commencement of Part III or, in an external Territory to which this Act extends, only after the expiration of 6 months after the commencement of the day on which this Act commences to extend to that Territory or the commencement of Part III, whichever is the later.

Penalty: Imprisonment for 6 months.

40 Liability of directors and employees

(1) A director of a company, or an employee or agent (whether of a corporation or of an individual), who intentionally or recklessly permits or authorizes a contravention of this Act by the company, corporation or individual, as the case may be, is guilty of an offence against this Act and is punishable by the penalty provided in respect of that contravention.

(2) If a director of a company or an employee or agent of a corporation intentionally or recklessly permits or authorises a contravention by the company or corporation, the reference in subsection (1) to the penalty provided in respect of the contravention is a reference to:

(a) the penalty that would apply to an individual in respect of the contravention; or

(b) if there is no penalty provided for an individual—a penalty not exceeding one-fifth of the penalty applying to the company or corporation in respect of that contravention.

(3) If:

(a) a company or corporation is the agent of an individual; and

(b) a director of the company or an employee or agent of the corporation intentionally or recklessly permits or authorises a contravention of this Act by the company or corporation in its capacity as agent of the individual;

then, despite subsection (1), the offence committed by the company or corporation as agent is punishable by a penalty not exceeding 5 times the penalty applying to the individual.

41 Hearing before making adverse decision

The Commissioner shall not make a decision under this Act that would be adverse to a person without giving to the person an opportunity of being heard and of presenting evidence.

41A Decision-making principles

(1) The Commissioner may, by signed instrument, formulate principles (decision-making principles) to be complied with by him or her in making a decision under section 21, 25, 31D, 31H or 34A.

(2) In making a decision under any of those sections, the Commissioner must comply with any relevant decision-making principles.

(3) Decision-making principles are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.

41B Insurance intermediaries taken to be associated because of prior conduct of personnel

(1) For the purposes of section 21 or 31D, an insurance intermediary (the subject intermediary) is taken to be an associated insurance intermediary in respect of another insurance intermediary (the failed intermediary) that has failed to discharge the ordinary obligations of an insurance intermediary if;

(a) a director of the subject intermediary:

(i) was a director, principal, employee or agent of the failed intermediary; and

(ii) if the director of the subject intermediary was an employee or agent of the failed intermediary—was in a position of influence or control over the operations of the failed intermediary; or

(b) the principal of the subject intermediary:

(i) was a director, principal, employee or agent of the failed intermediary; and

(ii) if the principal of the subject intermediary was an employee or agent of the failed intermediary—was in a position of influence or control over the operations of the failed intermediary; or

(i) was a director, principal, employee or agent of the failed intermediary; and

(ii) is in a position of influence or control over the operations of the subject intermediary; and

(iii) if the employee of the subject intermediary was an employee or agent of the failed intermediary—was in a position of influence or control over the operations of the failed intermediary; or

(d) an agent of the subject intermediary:

(i) was a director, principal, employee or agent of the failed intermediary; and

(ii) is in a position of influence or control over the operations of the subject intermediary; and

(iii) if the agent of the subject intermediary was an employee or agent of the failed intermediary—was in a position of influence or control over the operations of the failed intermediary.

(2) In subsection (1):

(a) a reference to a principal of an insurance intermediary is a reference to the principal of an insurance intermediary that is not a corporation and includes a sole trader; and

(b) a reference to an employee or agent of an insurance intermediary includes a reference to an employee or agent of an insurance intermediary that is not a corporation.

42 Application for review

(1) An application may be made to the Administrative Appeals Tribunal for review of a decision of the Commissioner under this Act other than a decision to delegate a power under section 47.

(2) In this section, decision has the same meaning as in the Administrative Appeals Tribunal Act 1975.

43 Statement to accompany notice of decisions

(1) Where the Commissioner makes a decision of a kind referred to in section 42 and gives to a person or persons whose interests are affected by the decision notice in writing of the making of the decision, that notice shall include a statement to the effect that, subject to the Administrative Appeals Tribunal Act 1975, application may be made to the Administrative Appeals Tribunal for review of the decision to which the notice relates by or on behalf of a person or persons whose interests are affected by the decision.

(2) Any failure to comply with the requirements of subsection (1) in relation to a decision does not affect the validity of the decision.

44 Accounts and audit

The regulations may make provision as to the inspection or audit of the books, accounts and records kept by registered insurance brokers or registered foreign insurance agents.

45 Certain particulars to be included in reports

The Commissioner shall, in each report given to the Treasurer after the commencement of Part III under section 231 of the Life Insurance Act 1995 or section 125 of the Insurance Act 1973, as the case may be, make reference to the working of this Act so far as it concerns him or her and shall include in the report particulars as to:

(a) the number of persons registered by him or her for the time being as foreign insurance agents, life insurance brokers or general insurance brokers, respectively;

(b) any suspensions or cancellations effected by him or her under section 25 or 31H during the period to which the report relates;

(d) any insolvency of an insurance intermediary that came to or her notice during that period; and

(e) such other matters (if any) as are prescribed.

46 Prosecutions

(1) An offence against this Act that is committed by a natural person and the maximum punishment for which is a pecuniary penalty exceeding $2,000 or a period of imprisonment exceeding one year, or both, is an indictable offence.

(2) An offence against this Act that is committed by a corporation and the maximum punishment for which is a pecuniary penalty exceeding $5,000 is an indictable offence.

(3) Notwithstanding that an offence against this Act is an indictable offence, a court of summary jurisdiction may hear and determine proceedings in respect of such an offence if the court is satisfied that it is proper to do so and the defendant and the prosecutor consent.

(4) Where, in accordance with subsection (3), a court of summary jurisdiction convicts a person of an offence against this Act, the penalty that the court may impose is:

(a) in the case of a natural person—a fine not exceeding $1,000 or imprisonment for a period not exceeding 6 months, or both; or

(b) in the case of a corporation—a fine not exceeding $10,000.

(5) An offence against this Act, other than an offence that by virtue of subsection (1) or (2) is an indictable offence, may be prosecuted summarily.

46A Time for bringing proceedings

(1) Despite anything in any other Act, proceedings for the summary prosecution of an offence against this Act may be brought at any time within the period of 3 years after the commission of the offence.

(2) If the Attorney-General consents in writing proceedings may be brought at any later time.

47 Delegation

The Commissioner may, by signed writing, delegate to a person all or any of the Commissioner’s powers under this Act or the regulations.

48 Regulations

(1) The Governor-General may make regulations, not inconsistent with this Act, prescribing matters:

(a) required or permitted by this Act to be prescribed; or

(b) necessary or convenient to be prescribed for carrying out or giving effect to this Act;

and, in particular, prescribing:

(d) fees payable in respect of any matter under this Act or the regulations.

(2) The regulations may make different provisions with respect to persons carrying on business in relation to life insurance business and persons carrying on business in relation to general insurance business.

Insurance (Agents and Brokers) Act 1984	75, 1984	25 June 1984	S. 10: 1 July 1986 (see Gazette 1986, No. S316) S. 12: 1 Aug 1988 (see Gazette 1988, No. S221) Ss. 18-31: 1 Jan 1986 (see Gazette 1985, No. S551) S. 37: 1 Mar 1987 (see Gazette 1987, No. S32) Remainder: Royal Assent
Statute Law (Miscellaneous Provisions) Act (No. 1) 1986	76, 1986	24 June 1986	S. 3: (a)	S. 9
Statute Law (Miscellaneous Provisions) Act (No. 2) 1986	168, 1986	18 Dec 1986	S. 3: Royal Assent (b)	S. 5(1)
Insurance and Superannuation Commissioner (Consequential Provisions) Act 1987	99, 1987	5 Nov 1987	23 Nov 1987 (see s. 2 and Gazette 1987, No. S310)	—
Statute Law (Miscellaneous Provisions) Act 1988	38, 1988	3 June 1988	S. 3: Royal Assent (c)	S. 5(1), (3) and (4)
Insurance Legislation Amendment Act 1989	16, 1989	20 Apr 1989	Part I (ss. 1, 2), ss. 3, 4, Part III (ss. 7, 8), Part V (ss. 19, 20), ss. 21, 22(1), 24, 25, 26(b)-(d), 26(2), 33(b), 34(1), 35-37, 40-44, 45(c) and 46: 18 May 1989 Remainder: 20 Oct 1989	Ss. 12(2) and 14(2)
Export Finance and Insurance Corporation (Transitional Provisions and Consequential Amendments) Act 1991	149, 1991	21 Oct 1991	1 Nov 1991	S. 3
Corporate Law Reform Act 1992	210, 1992	24 Dec 1992	S. 125: 23 June 1993 (see Gazette 1993, No. S186) (d)	—
Insurance Laws Amendment Act 1994	48, 1994	7 Apr 1994	Ss. 1-3, 10 and 40: Royal Assent S. 41: 6 Jan 1992 Remainder: 1 Oct 1994 (see Gazette 1994, No. GN38)	Ss. 35-39
as amended by
Statute Law Revision Act 1996	43, 1996	25 Oct 1996	Schedule 3 (items 33, 34): 7 Apr 1994 (e)	—
Financial Laws Amendment Act 1997	107, 1997	30 June 1997	Schedule 10: 1 Oct 1994 (f)	—
Life Insurance (Consequential Amendments and Repeals) Act 1995	5, 1995	23 Feb 1995	1 July 1995 (see s. 2 and Gazette 1995, No. GN24)	—
Statute Law Revision Act 1996	43, 1996	25 Oct 1996	Schedule 2 (items 67, 68): (g	—
Income Tax (Consequential Amendments) Act 1997	39, 1997	17 Apr 1997	1 July 1997	—
Financial Laws Amendment Act 1997	107, 1997	30 June 1997	Schedule 7 (items 1, 12, 24, 25): 1 Oct 1994 (h) Schedule 7 (items 2-11, 13-23, 26-75): Royal Assent (h)	Sch. 7 (item 75), [see Table A]
Insurance Laws Amendment Act 1998	35, 1998	22 Apr 1998	Schedule 1 (items 35-76): 30 Apr 1998 (see Gazette 1998, S188) Schedule 2 (items 28, 29): [see (i) and Note 2]	Sch. 1 (items 73-76) [see Table A]

S. 7 ....................	am. No. 149, 1991
S. 9 ....................	am. No. 168, 1986; No. 99, 1987; No. 16, 1989; No. 210, 1992; No. 48, 1994; No. 5, 1995; Nos. 39 and 107, 1997; No. 35, 1998
S. 9A ...................	ad. No. 16, 1989
Ss. 9B, 9C ...............	ad. No. 48, 1994
S. 9D ..................	ad. No. 35, 1998
S. 10 ...................	am. No. 99, 1987; No. 48, 1994; No. 107, 1997
Note to s. 10 .............	ad. No. 107, 1997
S. 11 ...................	am. No. 48, 1994; No. 107, 1997
S. 13 ...................	am. No. 168, 1986; No. 48, 1994
Note to s. 13 .............	ad. No. 107, 1997
S. 15 ...................	am. No. 107, 1997
S. 16 ...................	am. No. 168, 1986; No. 48, 1994; No. 107, 1997; No. 35, 1998
S. 17 ...................	am. No. 48, 1994; No. 107, 1997; No. 35, 1998
Heading to s. 17 ..........	am. No. 35, 1998
S. 18 ...................	am. No. 107, 1997
S. 19 ...................	am. No. 168, 1986; No. 99, 1987; No. 48, 1994; No. 107, 1997
S. 20 ...................	am. No. 168, 1986; No. 99, 1987; No. 48, 1994; No. 35, 1998
Note to s. 20 .............	ad. No. 107, 1997
S. 21 ...................	am. No. 99, 1987; No. 16, 1989; No. 48, 1994; No. 107, 1997
S. 22 ...................	am. No. 99, 1987
S. 23 ...................	am. No. 99, 1987; No. 16, 1989; No. 107, 1997; No. 35, 1998
S. 24 ...................	am. No. 99, 1987; No. 38, 1988; No. 107, 1997
S. 25 ...................	am. No. 99, 1987; No. 48, 1994; No. 107, 1997
Note to s. 25(4) ...........	ad. No. 107, 1997
Ss. 25A, 25B .............	ad. No. 16, 1989
	am. No. 48, 1994
S. 25C .................	ad. No. 48, 1994
S. 26 ...................	am. Nos. 76 and 168, 1986; No. 99, 1987; No. 48, 1994; No. 107, 1997; No. 35, 1998
Note to s. 26 .............	ad. No. 107, 1997
S. 27 ...................	am. No. 168, 1986; No. 48, 1994; No. 107, 1997
Note to s. 27(12) ..........	ad. No. 107, 1997
S. 28 ...................	am. No. 35, 1998
S. 29 ...................	am. No. 48, 1994; No. 107, 1997
Note to s. 29 .............	ad. No. 107, 1997
S. 30 ...................	am. No. 48, 1994; No. 107, 1997
Note to s. 30 .............	ad. No. 107, 1997
S. 31 ...................	am. No. 48, 1994; No. 107, 1997
Part IIIA (ss. 31A-31K)	ad. No. 16, 1989
S. 31A ..................	ad. No. 16, 1989
S. 31B ..................	ad. No. 16, 1989
	am. No. 48, 1994
Note to s. 31B(1) ..........	ad. No. 107, 1997
S. 31C .................	ad. No. 16, 1989
	am. No. 48, 1994 (as am. by No. 43, 1996); No. 35, 1998
Note to s. 31C ............	ad. No. 107, 1997
S. 31D .................	ad. No. 16, 1989
	am. No. 48, 1994; No. 35, 1998
S. 31E ..................	ad. No. 16, 1989
S. 31F ..................	ad. No. 16, 1989
	am. No. 35, 1998
S. 31G .................	ad. No. 16, 1989
S. 31H .................	ad. No. 16, 1989
	am. No. 48, 1994
Note to s. 31H(4) ..........	ad. No. 107, 1997
Ss. 31I-31K ..............	ad. No. 16, 1989
	am. No. 48, 1994
Ss. 32, 33 ...............	am. No. 48, 1994; No. 107, 1997
Note to s. 33 .............	ad. No. 107, 1997
S. 33A ..................	ad. No. 48, 1994
S. 34 ...................	am. No. 16, 1989; No. 48, 1994 (as am. by No. 43, 1996; No. 107, 1997); No. 35, 1998
Note to s. 34(1) ...........	ad. No. 107, 1997
S. 34A ..................	ad. No. 48, 1994
	am. No. 43, 1996
Note to s. 34A(9) ..........	ad. No. 107, 1997
S. 34B ..................	ad. No. 48, 1994
S. 34C .................	ad. No. 48, 1994
	am. No. 43, 1996
Ss. 34D-34K .............	ad. No. 48, 1994
S. 34L ..................	ad. No. 48, 1994
	am. No. 35, 1998
Ss. 34M-34P .............	ad. No. 48, 1994
Note to s. 34P ............	ad. No. 107, 1997
Ss. 34Q-34S .............	ad. No. 48, 1994
Note to s. 34S ............	ad. No. 107, 1997
S. 34T ..................	ad. No. 48, 1994
Note to s. 34T ............	ad. No. 107, 1997
S. 34U .................	ad. No. 48, 1994
	rs. No. 107, 1997
S. 35 ...................	am. No. 48, 1994
Note to s. 35 .............	ad. No. 107, 1997
S. 37 ...................	am. No. 168, 1986; No. 48, 1994
Note to s. 37 .............	ad. No. 107, 1997
S. 37A ..................	ad. No. 48, 1994
S. 38 ...................	am. No. 48, 1994; No. 5, 1995; No. 107, 1997
S. 39 ...................	am. No. 48, 1994; No. 107, 1997
Note to s. 39 .............	ad. No. 107, 1997
S. 40 ...................	am. No. 48, 1994
S. 41 ...................	am. No. 99, 1987
Ss. 41A, 41B .............	ad. No. 48, 1994
Ss. 42, 43 ...............	am. No. 99, 1987
S. 44 ...................	am. No. 16, 1989
S. 45 ...................	am. No. 99, 1987; No. 16, 1989; No. 5, 1995; No. 107, 1997; No. 35, 1998
S. 46A ..................	ad. No. 48, 1994
S. 47 ...................	am. No. 99, 1987
	rep. No. 107, 1997
S. 48 ...................	am. No. 48, 1994