The Gazette 1991

g a z e t t e

a p r i l 1991

(b) Effect

and to distinguish in that regard between brokers and agents. For the purpose of these bonding requirements which are largely based on the bonding requirements which have applied for some time to travel agents, the expression " t u r nove r" has been given a somewhat unusual meaning. It does not relate to turnover of the broker or agent in the normal accounting sense and, in fact, it excludes therefrom his commission and service charges entirely. The definition relates instead to the aggregate amount of " c l i ent monies" which in any year an insurance broker or agent is required to pay into separate bank accounts under Section 48 of the Act. Client Accounts The maintenance of separate client accounts is required by Section 48 of the Act. This applies to brokers and agents alike and requires them to maintain two separate bank accounts. The first bank account relates to non-life premiums and monies

payable to policy holders under non-life contracts. The second account to be main- tained is an account in connection with premiums payable in respect of life insurance and monies pay- able by policy holders in respect of life policies. An insurance intermediary, whether a broker or agent, is bound to pay all monies other than com- mission payments and service charges which he receives in connection with life business or non-life business into the relevant "The maintenance of separate client accounts is required by Section 48 of the Act. This applies to brokers and agents alike." bank account maintained by him. Such accounts are effectively client account but are designated under the Act as "Section 48 - Non- Life Insurance A c c o u n t" and "Section 48 - Life Assurance Accounts" respectively. Both these accounts must be maintained even where only one class of insurance business is carried on

The e f f ect of the Bond, however, must be such that in the event of the broker or agent being unable to meet his financial obligations in respect of monies received by him from or on behalf of his clients, the bond will provide a sum of money to become available to a person nominated or ap- proved of by the Minister and be applied by such person for the benefit of any client who has su f f e r ed a loss in consequence. Generally, insurance brokers and agents are required to take out an insurance bond to the value, in the case of non-life insurance business, of £25,000 and in the case of life assurance business to the value of the greater of £25,000 and 25% of the brokers or agents life assur- ance turnover in the previous accounting year. It should be noted that the Minister has power to alter the figures of £25,000 and 25% turnover

(c) Amount

S O L I C I T O R S PROFESSIONAL INDEMNITY

A Practical Solution to an annual problem Irish Life Finance Insurance Premium Payment Plan

You benefit from professional indemnity over a full year so why pay in one lump sum? Irish Life Finance offers solicitors the facility to spread the cost of the professional indemnity over the course of a year. We pay the premium due on your behalf.

Benefits to Solicitor:

Additional low cost source of finance. Overdraft/other credit lines left free for working capital and other purposes. Other professional services available from Irish Life Finance include Commercial Mortgages, Practice Finance and Leasing.

Please contact Mark MacMahon or Barbara McAleese on 01 - 745577

for additional information ii Irish Life F i n a n c e

127