Insurers and fund firms are among the businesses bearing the brunt of the FSA’s 16 per cent increase in annual costs for 2012/13.
Life insurers are facing a 37 per cent increase in their FSA fees, from £44.5m to £61.1m. General insurers face a steep increase in fees, which are set to rise 36 per cent from £29.4m to £40.1m.
Fund firms are expected to be hit with a 32 per cent fee rise, from £28.2m to £37.3m.
Association of British Insurers director general Otto Thoresen says insurers are already facing increasing costs related to the RDR, Solvency II, gender-neutral pricing and auto-enrolment.
He says: “We knew there would be a cost involved in moving to twin peaks’ regulation but in this difficult financial environment, all organisations need to be focused on controlling their costs. While insurers will do their best to absorb these costs, some will inevitably be passed on to small companies and private individuals at a time when they can least afford it.”
Investment Management Association director of wholesale Guy Sears says: “The 32 per cent increase for asset managers is most unwelcome.
Last year fund managers had to stump up £233m for the defaults of others and this year they may be required to cross-subsidise again. In that light, it is unclear if the FSA has its priorities right.”