Activity of EEA intermediaries in Norway (General Good)

The following legislation applies to the insurance mediation activities in Norway:

• Act on Insurance Mediation (Lovdata.no)
• Regulation on Insurance Mediation (Lovdata.no
• Act relating to Measures to Combat Money Laundering and Terrorist Financing (the Anti-Money Laundering Act) (Lovdata.no)

Further relevant legislation:

• Act on Insurance Activities (Insurance Activities Act) (pdf)
• Act of 16 June 1989 no. 69 on Insurance Contracts (pdf)
• Act of 27 November 1992 on Choice of Law in Relation to Insurance
• Act of 9 January 2009 on Marketing
• Act of 7 December 1956 on the Supervision of Credit Institutions, Insurance Companies and Securities Trading etc. (Financial Supervision Act) 

Finanstilsynet emphasises that the information is not exhaustive.

Insurance brokers who are registered in another EEA state may commence activities in Norway through a branch or as cross-border services one month after Finanstilsynet has received notification of the planned activities from the supervisory authority in the undertaking’s home country.

Insurance agencies registered in another EEA state can commence their activities in Norway once they have notified the competent authority in their home country.

The act on insurance mediation defines:

• Insurance agent activities as insurance mediation that consist of offering insurance product on behalf of one or more insurance undertakings.
• Insurance brokering as insurance mediation activities that consist of providing the customer with advice on the basis of an analysis of as large a number of the insurance solutions available on the market as possible, or activities that consist of presenting insurance solutions from one or more insurance undertakings to the customer, without a distinct contract having been signed with the insurance undertakings concerning this.

Insurance brokers who are registered in another EEA state and pursue activities in Norway must apply to the following regulation:

Regulations concerning good brokering practice, etc.

An insurance brokerage firm shall operate the undertaking in accordance with good brokering practice. The insurance brokerage firm must not act in a manner likely to cause doubt concerning its position as an independent intermediary. The insurance brokerage firm shall provide the documentation necessary for an insurance contract to be concluded.

The insurance brokerage firm shall exercise due care when selecting an insurance provider and advise the principal against using insurance providers whose ability to fulfil their obligations pursuant to the insurance may be called into question or is unknown.

The insurance brokerage firm may not, through agreements with an insurance undertaking or in some other manner, act in a manner that could influence the insurance brokerage firm’s independence as an intermediary.

Norwegian legislation prohibits an insurance broker operating in Norway from receiving commission from insurance companies. Commission is to be paid directly by the policyholder. The prohibition, directed both at the insurance broker and the insurance company, is designed to prevent doubts as to the independent role of the broker. However, the prohibition does not apply to the mediation of insurance contracts written by EEA insurance companies which are not established in Norway, provided that the commission received from the insurance company is transferred to the principal (customer). 

Insurance undertakings with which the insurance brokerage firms can conduct mediation business, etc.

Insurance mediation business may only be conducted with insurance undertakings with head offices in an EEA state and Norwegian branches of foreign insurance undertakings that hold a licence pursuant to Section 12-1 of the Act on Insurance Activity. Mediation of statutory non-life insurance may only be conducted with insurance undertakings that fulfil the requirements that apply pursuant to the special regulations for such insurance.

However, mediation of non-life insurance for the business sector may be conducted with non-life insurance undertakings with a head office in a state outside the EEA provided the insurance does not cover:

1. statutory occupational injury insurance
2. statutory liability insurance for motor vehicles
3. statutory liability insurance that covers compensation liability for injury caused by nuclear damage or by medicines.

Non-life insurance for the business sector means: 

1:

1. maritime and transport insurance 
2. aviation insurance 
3. insurance linked to exploration for or, the exploitation, storage or transport through pipes of subterranean natural deposits
4. credit or security when the policyholder is practising commercial or industrial activities or a liberal profession, and the contract applies for the activities

2:

1. insurance taken out by an undertaking with employees whose activities constitute the equivalent of at least 10 man-years
2. insurance taken out by an undertaking with an annual turnover of at least NOK 50 million

Information from the insurance intermediary

Prior to the conclusion of an insurance contract and in the event of changes to or the renewal of a contract, the insurance intermediary shall as a minimum provide the customer with the following information:

1. The insurance intermediary’s name and address,
2. which register the insurance intermediary is registered in and how one can check that the firm is registered,
3. whether or not the insurance intermediary provides advice on the basis of an objective analysis, cf. Section 1-2, no. 2, alternative one, of the Act on Insurance Mediation.
   1. the size of the commission and/or other remuneration that the insurance intermediary receives from the insurance provider in connection with the conclusion of a contract concerning insurance, and 
   2. the size of the commission or other remuneration that the insurance intermediary will demand from the principal,
4. whether or not the insurance intermediary has a direct or indirect ownership interest in an insurance undertaking that amounts to more than 10% of the voting rights or capital.
5. whether or not an insurance undertaking or the parent company of an insurance undertaking has a direct or indirect ownership interest that amounts to more than 10% of an insurance intermediary’s voting rights or capital,
6. the charge the policyholder is required to pay to the Norwegian Natural Perils Pool pursuant to Section 4a of the Act of 16th June 1989 no. 70 relating to Protection Against and Compensation for Natural Damage if fire insurance for risks in Norway is mediated from an insurance undertaking that is not a member of the Norwegian Natural Perils Pool,
7. about out of court complaints schemes.

When the insurance intermediary informs the customer that it provides advice on the basis of an objective analysis, cf. paragraph one, no. 3, it is obliged to provide this advice on the basis of an analysis of a large enough number of the insurance contracts available on the market to enable it to make a recommendation in accordance with professional criteria concerning which insurance contract will suit the customer’s needs.

When the insurance intermediary presents insurance solutions from one or more insurance undertakings to the customer without them being contractually bound to use these, they shall be so informed. The insurance intermediary shall at the customer’s request tell the names of the insurance undertakings it collaborates with. The insurance intermediary shall inform the customer of their right to request such information.

The insurance intermediary shall, particularly based on the information provided by the customer, as a minimum, clarify the customer’s demands and needs, and state reasons for any advice they give the customer concerning a specific insurance product. These clarifications shall be commensurate with the suggested insurance contract’s complexity.

An insurance intermediary firm shall moreover have the same duty to provide information as an insurance undertaking that conducts activities in Norway has, cf. chapters 2 and 11 of the Act of 16th June 1989 no. 69 relating to Insurance Contracts.

The information mentioned in paragraph one, nos. 3, 5, 6 and 8, and in paragraphs two to four is not required to be provided when mediating insurance as mentioned in Section 9a the Act of 27th November 1992 no. 111 on Choice of Law on Insurance to policyholders mentioned in the same provision (major risks).

Personal insurance - information and advice 

Section 11-1 of the Act of 16th June 1989 no. 69 relating to Insurance Contracts lays down a requirement for mandatory advice when selling personal insurance, which also covers insurance-based investment products. This applies to insurance intermediaries and insurance undertakings.

The requirement for advice means that a suitability assessment always must be carried out when selling personal insurance. In administrative practice, strict requirements have been set for obtaining information about the customer's demands and needs to ensure that an advice on buying insurance-based investment products actually covers a savings and insurance need of the customer of the kind that such products presupposes.

An advice when selling insurance-based investment products must also cover elements relevant to subsequent changes in the investment portfolio. Please see circular 14/2016 on Information and advice when selling life insurance with investment choices (in Norwegian only):

• Circular 14/2016 

Duty to inform Norwegian Natural Perils Pool

The insurance brokerage firm shall upon executing the brokering assignment inform the Norwegian Natural Perils Pool about fire insurance on risks in Norway that are mediated from insurance undertakings that are not members of the Norwegian Natural Perils Fund.

Duty to inform Finanstilsynet

The insurance brokerage firm is obliged at all times, at the request of Finanstilsynet, to provide the information concerning its activities that Finanstilsynet needs in order to practice its supervision in accordance with the provisions in act on insurance mediation.