NIBA Code Draft Puts Broker Fee Transparency Back in Focus

The independent reviewer of the Code had recommended broader remuneration disclosure for all individual and small business clients, regardless of product type. That would have meant more proactive information about fees, commissions and other payments for many businesses that rely on insurance brokers to arrange commercial cover. The latest draft, however, keeps the core disclosure obligation tied to retail products, while adding specific disclosure expectations for strata clients and giving businesses of any size the right to ask for a dollar figure.

For small business owners, the practical message is straightforward: do not assume every cost or incentive will be explained unless you ask. Broker remuneration can include client-paid fees, insurer-paid commissions, or a combination of both. None of these models is automatically wrong, but transparency helps clients understand whether the recommendation reflects their needs, the available market, and the true cost of arranging and maintaining cover.

The draft Code consultation remains important because it goes to trust, not just compliance. Many small businesses have complex insurance needs but limited in-house risk expertise. A café, trades business, transport operator or professional services firm may depend heavily on broker advice when deciding limits, exclusions, excesses and renewal options. If disclosure rules are too narrow, the burden may fall back on clients to know what to request before they can make a fully informed decision.

This development also extends the broader due diligence theme we have seen across recent insurance sector updates. Clients should ask how their broker is paid, whether different insurers pay different commissions, what alternatives were considered, and whether any conflicts could influence the recommendation. When comparing options, price is only one part of the decision; service quality, claims support, policy wording and disclosure standards all matter.

NIBA’s consultation is scheduled to close on 7 August 2026, with the new Code expected to commence on 1 January 2027. Until the final wording is settled, businesses should treat the debate as a timely reminder to request fee and commission information in writing and keep it with their insurance records.