Financial Markets Conduct (Conduct of Financial Institutions – First Insurance Limited) Exemption Notice 2025

The Financial Markets Conduct (Conduct of Financial Institutions — First Insurance Limited) Exemption Notice 2025 (Notice) exempts First Insurance Limited (FIL) for three months from the requirements under the Financial Markets Conduct Act 2013 (as amended by the Financial Markets (Conduct of Financial Institutions) Amendment Act 2022) (the Act) to:

1. be licensed as a financial institution; and
2. establish, implement, maintain, and comply with an effective fair conduct programme, and make information about the fair conduct programme available.

The exemptions apply to services in respect of certain group policies.

The Notice comes into force on 31 March 2025. 

The exemptions are subject to conditions that require FIL to:

1. ensure any offer of cover or dealing or interaction in connection with a group policy is handled in a manner that treats an insured person fairly
2. provide insured persons with information about the proposed transfers and the exemption and give them information on how to make a claim or complaint
3. provide the FMA with a written update every month on its progress towards ceasing to carry on an insurance business in New Zealand.

The key reasons for granting the exemptions (as set out in full in the Statement of Reasons in the Notice) are:

• where FIL is in the final stages of completing a transfer of its insurance business, the costs of becoming licensed and complying with fair conduct programme obligations under the Act are likely to outweigh the benefits for consumers; and
• FIL will be required to ensure that insured persons receive fair treatment in connection with the policies and that insured persons who are members of FCU are given information about the transfer of FIL’s insurance business, the exemption and how to make a claim or complaint; and
• FIL will be required to have appropriate contractual arrangements in place with FCU to ensure the conditions under this notice are met.
• As such, the FMA is satisfied that granting the exemptions is desirable in order to promote the purposes of the Act, specifically to avoid unnecessary compliance costs.
• The FMA is further satisfied that the extent of the exemptions are not broader than reasonably necessary given that the exemptions will only apply for a very short period after which FIL will cease to carry on insurance business in New Zealand.

Download Financial Markets Conduct (Conduct of Financial Institutions – First Insurance Limited) Exemption Notice 2025