7. My agent asks me to pay him cash so that he can pay my premiums promptly on behalf of me. Is he allowed to handle premium payments in this way?
There are clear requirements under the Code of Conduct for Licensed Insurance Agents issued by the Insurance Authority in relation to how an insurance agent should handle client’s premium. The agent must have the authority to receive and handle the premiums on behalf of the insurance company and to handle those premiums in strict conformity with the requirements, controls and timing set out by the insurance company. Also, your agent has to avoid mixing your money with his personal funds and maintain proper records of premiums received.
Regarding payment of premiums by way of cash, your agent is allowed to handle cash payments, if
- it is not reasonably feasible for the agent to accept payment by any other means; and
- the insurance company authorizes the agent to receive cash payment, and the payment is received and handled within the limits of such authority.
To be on the safe side, you should check the rules and satisfy yourself that your agent will act accordingly.