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Insurers and insurance brokers and financial sanctions

  • by The Quotesonline Team
The Insurance Council has announced that Australian businesses, including insurers, brokers and agents, are subject to sanctions legislation and are responsible for ensuring they do not provide services to sanctioned individuals or entities.
Sanctions can include arms embargoes, travel restrictions, financial restrictions and import/export bans of certain commodities. Sanctions can be imposed against individuals, entities and/or countries. The United Nations Security Council imposes sanctions to respond to situations that pose a threat to international peace and security. UN member states are obliged to implement UN Security Council sanctions domestically.
As a member of the UN, Australia is legally bound to adopt these measures and implements its obligations under UN law through the Charter of the United Nations Act (COTUNA). In addition to UN sanctions, the Australian Government imposes its own sanctions, known as ‘autonomous sanctions’, as a way of bringing pressure to bear on regimes that deny human rights and democratic freedoms.
In order to comply with sanctions and avoid penalties, DFAT requires Australian businesses to:
Ø regularly screen customers against the Consolidated Sanctions Lists published and maintained by DFAT. This contains the names of individuals, companies and countries against whom Australia has imposed financial sanctions. A list of currently sanctioned individuals can be found on the DFAT website.
Ø freeze assets belonging to any customer(s) whose name appears on the lists published by DFAT, and
Ø notify the Australian Federal Police and seek their assistance to determine whether the customer whose name matches the name of a sanctioned individual in the DFAT lists is in fact the same individual.
In some circumstances insurance services may be a “permissible dealing” under the legislation, however authorization from DFAT is required before services or transactions can occur.
All businesses in the General Insurance sector have to ensure they are aware of the requirements under sanctions legislation and undertake measures to ensure their own unique business operations are complaint where necessary.
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