Global Benefits Group (GBG) is warning that some brokers and agents will not be paid commission from selling the firm’s products after the international private medical insurance (IPMI) provider entered administration.
It added intermediaries are likely to experience a “higher-than-normal” level of enquiries from customers after it referred them to their brokers and agents.
GBG entered into administration on 21 December after it was unable to recover from uncovering historical financial issues last year.
GBG said that commissions due under GBG Insurance products will not be paid to intermediaries. However, brokers and agents can submit claims for unpaid commissions as an unsecured claim against GBG Insurance.
But other broker commissions for ongoing business that had not been underwritten by GBG Insurance, will continue to be paid, although there may be a slowdown in payments as a result of administrative issues created by the insolvency.
As for the future role that brokers will play in new business, GBG said it expects that insurance brokers and agents will continue to originate new business for certain aspects of GBG.
Further clarity on the ongoing business will be shared with the broker network over the coming days and weeks, it added.
Broker action
Touching on action brokers should take on its website, GBG said customers may or may not have been directly insured by GBG Insurance.
Depending on who underwrote their GBG insurance product, which varies by type and age of insurance product and geographical location, GBG customers could be materially impacted by the insolvency of GBG Insurance.
The insolvency of GBG Insurance could mean that brokers’ GBG customers no longer have access to their healthcare, disability, travel, and life insurance cover, it warned.
The firm called on advisers to also review the FAQs in the first instance and contact their GBG representative if they have any questions on the impact of GBG Insurance’s insolvency on their clients.
Having reviewed their policy documentation and read the relevant FAQs, brokers have been told they can then assess what assistance their GBG customers may need to help them consider the impact of the insolvency on their GBG related insurance and the need to obtain alternative insurance cover.
But given that GBG customers have been asked to contact their agent or broker if they have any questions concerning the policyholder documentation, GBG warned brokers may experience a higher-than-normal level of enquiries.
Who is covered?
GBG clarified that provided the insurer named in the customer’s policy documentation is not solely GBG Insurance, customers will still have a valid insurance policy and will be entitled to the ongoing financial benefits under their insurance policy.
Those direct policyholders who are solely insured by GBG Insurance will likely face a shortfall against any claims they seek to bring in the administration.
But the administration of GBG Insurance does not automatically terminate the policy and GBG pointed out certain direct policyholders may wish to seek alternate insurance.
Policyholders have been asked to review their policyholder documents and consult the appropriate FAQs for more information.
Paying claims
In terms of a timeframe for reviewing and paying claims, GBG provided reassurance that claims handlers on behalf GBG Insurance are working as quickly as possible to progress claims and that they will contact claimants as those claims progress.
While claims holders with other insurers may see a slight delay in claim payments in the short term, they should see no material change in ordinary course operations.
On any outstanding renewal quotes, customers have been asked to review the appropriate FAQ to understand the status of such renewal quotes.