Media Release - October 1 2003

QBE Mercantile Mutual's Authorised Representative Strategy

QBE Mercantile Mutual has released its Authorised Representative Strategy.

QBE Mercantile Mutual only distributes products via its professional distribution network which currently consists of agents and brokers. After transition to the FSR environment, Authorised Representatives and AFS Licensees will be the distribution network for QBE Mercantile Mutual's products.

QBE Mercantile Mutual firmly believes that our Authorised Representatives should be the mark by which the industry is judged and therefore views our Authorised Representative Strategy, as a real commitment to being the Right Partner for our Authorised Representatives.

Key aspects of our Authorised Representative Strategy are;

• The selection of Authorised Representatives will be based upon the past performance history in generating a profit and having no previous history of compliance breaches, (eg. breaches of law or QBE Mercantile Mutual policies);
• All Authorised Representatives will have to meet QBE Mercantile Mutual's minimum requirements for FSR compliance, namely completion of:
  • General Insurance Code of Practice, Privacy training;
  • ASIC PS 146 Tier 1 accreditation from a Registered Training Organisation (RTO)
  • Advice training for all that provide financial advice
  • FSR Fundamentals and Non Advice training for staff who do not provide financial advice
  • QBE Mercantile Mutual product training
  • Dealing training, where appropriate
• Authorised Representatives must agree to participate in QBE Mercantile Mutual's FSR Self Assessment Compliance program, FSR Audits and/ or Audits arranged by our cross endorsed partners. Authorised Representatives also have an obligation to report any compliance breaches via c.ch@nge;
• Authorised Representatives will be required to use QBE Mercantile Mutual's electronic products. This includes our Home, Motor, Business and Farm Package products, along with any other electronic products, when they are launched;
• Subject to meeting certain requirements, QBE Mercantile Mutual will be allowing its Authorised Representatives to Cross Endorse with other Licensees. QBE Mercantile Mutual will select which other Licensees it will allow its Authorised Representatives to cross endorse with on the basis on whether each Licensee:
  • Has a Standard and Poors rating that is equal to or better than QBE (Australia) or Mercantile Mutual (Australia)
  • Is APRA regulated or owned by APRA licensed entities
  • Can demonstrate training, compliance, monitoring and supervisory system and capabilities that comply with QBE Mercantile Mutual's requirements
  • Can demonstrate strong existing relationships with a significant proportion of QBE Mercantile Mutual's current agent base
  • Can demonstrate a willingness to work with QBE Mercantile Mutual on reducing cost and complexity of FSR compliance in cross-endorsement situations
  • Agrees to cross endorse with QBE Mercantile Mutual;
• Generally existing commission arrangements will remain unchanged.

QBE Mercantile Mutual has also recently appointed Ian Thomas to the role of Operations Manager - Authorised Representatives, reporting to Shaun Standfield, National Operations Manager. The focus for this role is the coordination and delivery of the Authorised Representative strategy both internally and externally for Authorised Representatives. "Our goal with this new appointment is to provide an efficient service for our Authorised Representatives under the FSR environment" says Terry Ibbotson, Executive General Manager, QBE Mercantile Mutual.

QBE Mercantile Mutual's Business Development Managers will be actively, discussing the Authorised Representative Application process and delivering "FSR packs" to prospective Authorised Representatives in late October 2003.

"We are proud of our strong reputation in the Intermediary Market. The FSR packs we have put together will help prospective Authorised Representatives through the transition and reinforce QBE Mercantile Mutual as the Right Partner" states Terry Ibbotson.

If you have any questions about the QBE Mercantile Mutual Authorised Representative Strategy or the Application Process please call: