NIBA Finalises 2027 Insurance Brokers Code of Practice, Written for Clients

The National Insurance Brokers Association (NIBA) will launch the 2027 Insurance Brokers Code of Practice at its Convention in the coming week. The Code takes effect on 1 January 2027. It sets out, in plain English addressed to clients, what they can expect from their broker.

The Code was built in three stages: an independent review, followed by two rounds of NIBA consultation. Across those stages, the review and consultation drew 51 written submissions. NIBA’s first round included 11 workshops with about 80 brokers, and three member surveys that drew 243 responses. In all, more than 10,500 brokers were represented through the first round. The second round put the draft Code out for comment. In that round, 35 firms and individuals worked through the draft clause by clause, 515 members joined a webinar, and more than 300 pieces of feedback were recorded. Each piece of feedback was mapped to the clause it addressed and has a recorded decision. Between the draft and the final Code, 21 clauses changed as a result.

“Three stages of consultation, 51 written submissions and more than 300 pieces of feedback on the draft produced one final Code. We could not accept every view, but we weighed each one. Twenty-one clauses changed because of what we heard, and the 2027 Code is better for every piece of feedback,” said NIBA CEO Richard Klipin.

The 2027 Code has 14 sections, up from 12 in the 2022 Code. Two of the sections are new: managing conflicts of interest and keeping client records. NIBA’s comparison with the 2022 Code counts 60 new provisions. The minimum notice before a policy renewal doubles, from 14 days to 28.

Under the Code, a broker that identifies a conflict of interest it cannot manage in the client’s best interests must tell the client immediately and stop acting on that matter. Any client, whether retail, wholesale, strata or a business of any size, can ask what their broker is paid and receive the answer in dollars within a reasonable time. Where commission must be disclosed, it is shown in the quotation for each insurer compared and as a dollar amount on the invoice. A client experiencing a difficult time can, with their consent, have it recorded once, so they do not need to repeat their circumstances each time they make contact. After a declared catastrophe, brokers must contact affected clients as soon as they reasonably can and offer to help them lodge their claims.

“Many good brokers already do these things. Under the 2027 Code, every broker bound by it must,” said Mr Klipin.

Other changes sit behind the desk. Conflicts obligations that were spread across four sections of the 2022 Code now sit together in one, and must be applied consistently across a business. Staff must be trained to support clients experiencing vulnerability when they join, and again every year. Client records must be complete, accurate and secure, and kept until any complaint, dispute or claim is resolved. Annual reporting to the Insurance Brokers Code Compliance Committee is now written into the Code.

“Brokers are the voice of the client, so we tested every answer against the people brokers serve. Some of this change clients will rarely see, but they will feel it: in how conflicts are managed, how staff support clients experiencing vulnerability, and how records are kept,” said NIBA President Nick Cook.

“Feedback we did not adopt still did its job, because it made us test the reasoning behind every call. I thank everyone who made time to work through the draft. That includes brokers from sole practitioners to the largest multinationals, regulators and government agencies, the external dispute resolution scheme, consumer and financial counselling organisations, professional bodies and the Code Compliance Committee,” said NIBA Code Review Committee Chair Di Phelan.

NIBA will release the 2027 Code at the upcoming Convention, ahead of the Code taking effect on 1 January 2027.