Reputations are delicate things and, like a house of cards, they take a long time to build but only seconds to destroy. The world of financial services relies in many ways on reputation and, certainly for advisers, a good reputation will help generate referrals, which are the driving force behind any successful intermediary business.
Ironically, the introduction of regulation has led, in a number of cases, to damaging publicity for the financial services sector. Clearly, it is better that problems are brought to light but in doing so, negative publicity has highlighted the problems to consumers and made them more aware of market failures.
Yes, we want to see a better regulated and policed market and, yes, consumer protection is important but the unintentional consequence of better policing is that where problems are found, they taint the reputation of all in the market and not purely those who have been acting with impropriety.
Financial services is an easy target and it is easy for the media to concentrate on perceived excesses than the many successes of the UK’s vibrant financial services community. As such, it is in everybody’s best interests to ensure that not only is the policing effective, so as to root out problems and deliver confidence to both market practitioners and clients, but also to stamp out problems which will slowly eat away at that confidence if they are allowed to go unchecked.
This is why the FSA’s regulations and standards are so important. They provide a benchmark against which firms can measure themselves, no matter how or in what market they sell financial products. This is particularly important in the more diverse sectors, where there are many different models and distribution channels.
Insurance products are sold to millions of clients in the UK every year, generating billions of pounds in premium income. Monitoring activity on such a widespread and diverse scale is not an easy task and explains why the regulator has chosen to take a principle-led approach to its regulation.
However, the fact that its regulations are not prescriptive to the letter does not mean they do not clearly lay out the standards that each and every practitioner in the market has to reach. They are also very clear on the need for ongoing and continuous training and development to ensure that these standards are maintained and improved.
As a sector, it is imperative that firms right across the board meet these benchmarks and do not allow the market’s reputation to be unnecessarily tainted. As such, established and well-structured training is essential, as are benchmark exams, which firms can use to show that their staff have attained the required standards and are contin-uing to maintain them.
Our Certificate in Regul-ated General Insurance (CeRGI) was developed to support the General Insurance Standards Council training and competence regime and was then revised to reflect the introduction of statutory regulation through the FSA in January 2005.
Thousands of insurance practitioners have completed CeRGI and gained certification since it was launched almost two years ago, satisfying the regulator’s criteria to operate in the market.
As well as covering the role and benefits of general insurance and educating about the insurance market, the qualification covers regulation, legal principles, underwriting and claims, ensuring that practitioners have a comprehensive grounding in these vital areas.
Candidates can take the exam in one of about 150 test centres across the country. Ensuring that they can have the test at a time that suits them and having test centres that span the whole of the UK is important in ensuring the greatest levels of flexibility for those seeking certification.
Learning materials to support the course are available online. This means that study can be done at the office, at home or wherever is most convenient for each student. Again, flexibility and convenience are the watchwords. Our commitment to the online arena also extends to on-demand, online testing. It takes an hour and candidates will find out immediately after completion if they have passed rather than having to wait for weeks for their results in the post.
Now that regulation is in place, the overriding concern for everyone in the market must be to make it work effectively. This will require ongoing consultation and regular tailoring to the rules in place but by working with the FSA, it will be possible to help it deliver quick, effective and necessary regulation to the market, which improves the standards of the services being supplied to consumers across the board.
In turn, this will help improve the market’s reputation and ensuring practitioners are properly qualified in this area will go a long way to achieving this.
Training really is the cornerstone to success in this area. It is not just up to individual firms to make sure their staff are progressing in the right direction but also to the industry bodies and trade associations. Given the diversity of the insurance market, this will be difficult but the challenge can be met if the will exists to achieve this.
Well qualified, informed staff help drive forward the reputation of the insurance market. As insurance practitioners strive to be recognised for the professional job that they do, they must also accept they will have to prove that professionalism and certification is probably the best way of doing so.