Industry experts predict life company products will not come under the scope of the FSA’s platform rebate ban.
In its platform policy statement last August, the regulator said it was “desirable” to ban payments between product providers and platforms for advised and non-advised business but delayed final rules to carry out further research.
Platforms have lobbied for life company wrappers to face a similar rebate ban. Last September, Cofunds chief executive Martin Davis predicted the FSA would “inevitably” extend any rebate ban to life wrappers to avoid an unlevel playing field.
But Fidelity FundsNetwork head of commercial Ed Dymott says life company products are now unlikely to be brought under the ban, ahead of an FSA consultation paper later this year. He says: “We do not believe life insurers will come under the new rules but it is our understanding that execution-only platforms will remain under the scope.”
Davis says: “We are still hopeful the FSA will look at all the aspects of a rebate ban and we will continue to talk with them because we believe all rebates should be treated the same.”
Avalon director Harry Kerr says: “It is bizarre you could treat platform rebates and those from a life insurance product differently and serves to create more confusion.”