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Travel Agent Client Trust Account Fidelity InsuranceGow-Gates Logo

Rather than arranging an insurance policy designed to protect your customer’s funds from the consequences of the financial failure of your business, the new product that Gow-Gates have developed is designed to protect your Client funds that you have isolated in a special Client Trust Account.

The use of a Client Trust Account to isolate client funds will provide a significantly better level of consumer protection than if you simply use one bank account, containing both your operating funds, and your clients’ funds.

If you do not currently operate a Client Trust Account, Macquarie Bank Limited have tailored a facility for Travel Agents to open an account very quickly and simply. The Macquarie Bank Client Trust Account is designed to include the following features, subject to your own negotiations and agreement with Macquarie bank:-

  • A simple and quick application and approval process
  • No application fee
  • Set up usually within 24 hours
  • Standard banking fees and charges apply
  • Interest bearing
  • Risk Management mechanisms pre-approved by our Insurers

Macquarie is an authorised deposit taking institution in all states and territories. Macquarie Business Banking is the retail business banking arm of Macquarie Bank Limited. Macquarie Business Banking has a long history of providing banking services to many financial services and professional services industries.
Please note: A key factor with a Client Trust Account is to ensure that the funds are in fact held in trust and have been properly retained so as not to defeat the trust (eg. not mixed with other company funds). To ensure that you preserve the integrity of the Client Trust Account, we would strongly recommend that you seek independent professional advice to structure your procedures appropriately.

Assuming the client funds are isolated correctly in the Client Trust Account, then the most significant residual risk to those clients’ funds which arises from the threat of fraud or theft.

Fidelity Insurance

Many standard Crime or Fidelity Insurance policies may protect Client funds against the risk of fraud or theft to some degree, but because most crime covers exclude coverage relating to Directors and Officers of the Insured, the Client funds would still be exposed to uninsured fraud or theft which would defeat the purpose of the policy.

Another problem with standard Crime coverage is that the Travel Agent is normally the Named Insured under the policy, and therefore there is no tangible value proposition or “peace of mind” that the Travel Agent can provide to their Client.

To overcome these particular issues, our new product provides another tailored solution to support the Travel Industry.

Travel Agent Client Trust Account Fidelity Insurance

To provide peace of mind to Clients, and a tangible value proposition, the exclusive Fidelity Insurance Policy that we have designed and negotiated will work on the following basis:

  • The Fidelity Insurance policy will specifically protect your Clients funds within your nominated Client Trust Account from fraud or theft.

  • Insurers will pay back on behalf of your Clients, directly into the Client Trust Account, any money that is due to insured theft or fraud

  • The policy covers the risk of funds fraudulently being withdrawn from the Client Trust Account at any time, not just in the case of Insolvency

  • The policy also covers Client funds paid to the Travel Agent, but not paid into the Insured Trust Account as a result of theft or fraud

  • Coverage is provided for theft or fraud committed by any Partner, Director, Officer or Employee of the Insured Travel Agency and also by any Third Party.

  • A simple and quick application and assessment process

  • Should you already have, or choose to set up a Macquarie Bank Client Trust Account, the risk management mechanisms for account control are already built into their systems and have been pre-assessed and approved by our Insurers.

  • The Fidelity Insurance is also available to protect non-Macquarie Bank Client Trust Accounts. An addendum to the application form is required to enable Insurers to assess the security of the account.

The premiums charged for this Fidelity Insurance are commensurate with the value of the maximum client funds held within the Client Trust Account.

For more information or an application form, please contact Gow-Gates Insurance Brokers Pty Ltd.

Gow-Gates image

General Advice Warning
The information in this document is intended as a guide only and should not be relied upon without consulting your relevant insurance policy wording and conditions or conversely seeking independent professional advice. Failure to adhere to this warning could result in a denial of a claim or potential loss or a reduction in settlement of a claim or potential loss.

Gow-Gates Insurance Brokers advises that persons should not act on the material contained in this article as the items are of a general nature only and may be misinterpreted. We therefore recommend that advice be sought before acting in these areas.