View more on these topics

FSA caught in PI insurance trap

A plank for the establishment of the FSA was to protect investors and, we hope, all other operators within the insurance industry. As far as IFAs are concerned, they have no powers to do so any longer.

The environment which encouraged and presided over the pension review into so-called misselling was a total abuse of position and authority without regard to matters of integrity and fairness.

That spirit pervades the FSA in its misdirected zeal to protect the investor.

The result is that many IFAs have been bankrupted because their clients were invited to take them to the cleaners, invariably with no justification.

Those IFAs who remain either have no PI insurance or, at a vastly increased cost, have totally inadequate PI insurance.

The FSA happily sends guidance “to deal with this situation”, which is not rooted in the real world. It now seems that they have no alternative but to accept that IFAs are trading without PI insurance or without compliant PI insurance – and they can do nothing about it.

Where an IFA continues to trade without compliant PI cover, the FSA has the right to withdraw their licence and put them out of business. However, as IFAs are unable to obtain compliant cover, the FSA is unable to protect the investor or the industry.

This is the inevitable conclusion from the lack of integrity in the pension review. The mentality which the FSA was appointed to correct was that mentality which has no scruples, honesty and integrity.

As an IFA, I have a lifetime vocation to look after my clients. In order to be able to do that I could not get away with any lack of integrity towards my clients.

The biggest disservice which Howard Davies has done is to the FSA – who can no longer protect investors by an insistence upon an effective form of PI insurance

Malcolm Baxter

Tring Hertfordshire


Derek Bottom

Sainsbury&#39s Bank deputy chief executive Derek Bottom is stocking the shelves with the Sandler suite in a bid to beat the high-street banks.Bottom must be the Government&#39s dream come true. He firmly believes that the public can be persuaded to save without advice as long as they are continually urged to do so through store-based […]

Impartial booklet to aid advisers on income protection

IFA consultancy firm Impartial is offering a booklet aimed at helping IFAs highlight the need for adequate income protection to clients.The company says the guide, entitled, The Value of Income Protection Insurance, is the latest in a series of booklets aimed at showing advisers through potentially new business areas. Other guides include mortgages and critical-illness […]

Misselling warning as Isas win over pensions

IFAs selling pensions to basic-rate taxpayers could be guilty of misselling as Isas will be more attractive under the new Inland Revenue regime, leading pension consultant Ros Altmann is warning.Altmann, a former adviser to No 10 Downing Street, says it is a good job that stakeholder has not been a success as anybody in its […]

Inter-Alliance joins ScotProv loan club

Abbey National has signed a deal with Inter-Alliance which will see its Scottish Provident mortgage club made available to the IFA&#39s 400 mortgage advisers. Inter-Alliance advisers will now have access to The Mortgage Alliance&#39s 21 lenders, including Abbey National, Bristol & West, Halifax and Woolwich. They will also be provided with free access to the […]


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