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Life offices wary of criticising ABI kitemark scheme

Life offices have expressed reservations over the ABI&#39s brand

accreditation project which is aimed at raising industry standards.

While many life offices agree in principle with the aims of Saltr – the

Savings and Long-Term Risk project – they fear it could damage their

businesses.

However, there is concern that if they are openly critical of the ABI&#39s

initiative, life offices will be ostracised and labelled as unwilling to

raise their standards.

Many have expressed reservations about some of the initiatives, including

plans for a two-month cooling-off period.

Life offices have also criticised how the ABI intends to implement its

accreditat- ion process.

Potential problems have been highlighted for life off- ices with offshore

arms. There are claims that because these arms operate in different

markets, Saltr may not be appropriate for this sector of busin- ess.

However, under the ABI plans, accreditation will only be given to a brand.

This raises the possibility that the onshore office will be refused

accreditation because of the way its business is conducted offshore.

There have also been complaints that multi-brand companies such as Zurich

Fin- ancial Services, which includes Allied Dunbar, Eagle Star and

Threadneedle, or Prudential, which includes M&G, Scottish Amicable and Egg,

would only need to apply for individual accreditation.

A life office insider says: “We accept the principle of Saltr to improve

the indus- try but, if it is not properly thought through, which is the

case for many aspects of the ABI&#39s plan, then it could lead to undesirable

side-effects for the industry.”

ABI spokesman Vic Rance says: “The Saltr project is about developing and

stretching standards.

“We have said all along that it will not easy to meet these standards and

it is those changes that are making companies uneasy. But there is no

question of anyone being ostracised.”

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