Commonwealth Numbered Acts

Insurance (Agents and Brokers) Act 1984 No. 75 of 1984 - SECT 38

38. (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 him 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 a corporation is related to another corporation for
the purposes of this section shall be determined in the same way as the
question whether a corporation is related to another corporation is determined
for the purposes of the Companies Act 1981.

(4) This section has effect notwithstanding anything in the Insurance Act 1973
or the Life Insurance Act 1945.

(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:

   (a)  in the case of a natural person-$2,000 or imprisonment for 1 year, or
        both; or

   (b)  in the case of a corporation-$10,000.