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Broker of record

Insurance broker who has been designated in writing by a client to provide certain insurance coverages and services.
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Broker designated by an insured to handle certain Insurance contracts for that insured.

Broker of record letter

A way for an insured to change agents midterm. The letter terminates the insured’s relationship with agent A, and allows him to establish a new relationship with agent B. The letter gives agent B the authority to act on behalf of the insured, and terminates that ability with agent A. The commissions from the first account will transfer to the new agent after the date of change.

Broker’s cover note

A document issued by an insurance broker confirming that an insurance has been effected. It warrants to the client that his or her instructions have been carried out, but imposes no liability on an insurer who has not actually entered into any agreement. If the cover note is issued in anticipation of making an agreement that does not materialise the broker will be liable for breach of warranty.

Broker’s lien

In marine insurance the broker is liable to the insurer for the premium even though not collected from the insured. Consequently, the Marine Insurance Act, s.53(2), grants him a lien, i.e. the right to retain the policy until paid by the insured. The lien is valuable as no claim can be collected without production of the policy; the insured may wish to deposit the policy with his bank, or pass it to another interested party. The lien applies not only to the premium on the policy but the balance of any insurance account due to the broker. The lien has been held to apply in other classes of insurance in respect of the premium but not the balance due on any insurance account.

Broker’s open cover

A variation of ordifacultative reinsurance nary method, whereby a reinsurer agrees in advance to accept reinsurance from a reinsurance broker. The reinsurer becomes obliged to accept a share of any business ceded to it through the broker, who thus acquires a facility for automatic reinsurance.

Brokerage

UK: 1. The commission and fee income received by an insurance broker. Normally commission is received from the insurer, but brokers may also charge fees to their clients. 2. A US term for an insurance broking company, firm or office. 3. The fee paid to a broker who arranges reinsurance cover for a ceding office.
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The business of a broker. Also, the fee/commission paid to a broker who arranges Insurance.
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UK: the commission received by a broker or other intermediary for placing insurance risks.
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The commission that is payable to a broker for placing an insurance or reinsurance contract with an insurer or a reinsurer. Compare fee for service. Although brokerage is payable by the insured as part of the gross premium the amount of brokerage is agreed by the insurer. The insured may request his broker to state the amount of his brokerage on a given placement. Similar considerations apply to reassureds under reinsurances. Sometimes the term brokerage may be used to refer the business of a broker.
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The sum paid to a broker as a commission. This term can also refer to insurance placed with brokers.