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Concern mounts as IMD deadline looms

Concern is growing that some IFAs will not be able to meet the demands of the Insurance Mediation Directive when it comes into operation on January 14, 2005.

Aifa and the LIA are urging their members to ensure they are prepared for the directive which requires intermediaries to provide customers with an initial disclosure document and have a procedure in place for referring on complaints which are not applicable to them.

LIA head of public affairs John Ellis says he is not sure if IFAs are ready for the requirements of the IMD and the LIA is providing information for members.

Aifa stresses that the IMD does not only cover protection business but also life, pensions and investments. It warns IFA firms which have been treating protection business as low-risk that there could be problems.

Aifa acting director general Fay Goddard says: “The IMD does not just cover insurance, it also takes in life, pension and investment products and I am not sure that firms are fully aware of it. If IFA firms are doing protection business to the same standard as investment business then they should not have a problem but if they have been treating it as low-risk they might have problems.”

Ellis says: “IFAs have to introduce the IDD from January 14 and I am not sure they are ready. Firms must make sure they are up to speed.”

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