View more on these topics

&#39Use compensation scheme to self-insure advisers&#39

The FSA should reform professional indemnity insurance so that the Financial Services Compensation Scheme provides cover for advisers, an IFA argues in a letter to FSA chairman Howard Davies.

In the letter, which marks the first responses to Money Marketing&#39s call for firm FSA action over the growing PI crisis, Langtons IFA managing director Colin Langton points out that current excesses are so high that, in the event of a big claim, most IFAs would be likely to go into liquidation, leaving the FSCS to pay out.

Instead of paying infl-ated PI premiums to insurers, Langton says IFAs should pay increased levies straight into the FSCS as a way for the industry to self-insure.

Nicholls Stevens proprietor Carole Nicholls says: “It is an excellent idea but the problem is that we are likely to find, as the lawyers did with a similar plan, that the claims will exceed what we add to the pot.

“However, we have to provide the consumer with some kind of cover. The whole point of the legislation is to protect the consumer.”

Langton says: “It is the FSA inviting claims that is forcing PI premiums up. This is something that just would not happen in any other industry.

“In fact, we think it is probably illegal. If people are approached, their memory about what happened in the past is bound to be selective if they are offered a big payout.”

The FSA declines to comment.


OUTSIDE EDGE – Michael Owen

While markets tumble and issues such as the split-cap debacles, life company solvency margins, etc, dominate the financial pages, the old chestnut of past performance has been in the news.The industry believes past performance matters but the FSA needs some convincing. When looking at the FSA comparative tables, I am reminded of the saying that […]

Pima wants lifetime account to come under stake suite

A lifetime savings account operating on Isa rules should be included in Sandler&#39s new suite of stakeholder products, according to the Pep & Isa Managers&#39 Association.In its pre-Budget submission to the Treasury, Pima is calling on the Government to take a number of steps to reinforce the strength of Isas as a savings vehicle, including […]

Annuities bouy NU as bond business fall

Business at Norwich Union dipped by 5 per cent in the third quarter this year although with faltering sales of bonds and Isas were substantially made up by increased annuity and group pension sales.Parent Aviva saw worldwide sales rise by 7 per cent to £1.75bn from £1.62bn in equivalent premium income.NU refuses to break down […]

Park Row new arm aims for non-conform market

Park Row Independent Mortgages is launching into the non-conforming sector through a new sub-prime division.It has created Park Row Specialist Lending in partnership with packager The Mortgage Placement Company to offer loans, including self-certification and right to buy, through its 280 advisers and will pay a procuration fee of 1.75 per cent. It is also […]

In Focus image

In Focus — May 2015: private medical insurance market in Germany

Welcome to the latest edition of In Focus. In this issue, Jelf examines the private medical insurance market for employers with expatriate workforces in Germany. This includes the common challenges faced in sourcing appropriate coverage, along with a selection of available solutions. This will be of particular interest to HR/reward decision makers with employees based in Germany. It will assess the cultural norms, risks and backdrop that are relevant to organisations with expatriate staff in this location.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm