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Two-thirds of IFAs support captive PI plan

Two-thirds of IFAs think that the creation of a captive insurer offering professional indemnity insurance solely to IFAs would make it easier to get compliant cover, according to George Street Research.

Its monthly Omnifa survey reveals that 67 per cent of IFAs think that if such a scheme was established, it would definitely or probably make it easier to find cover.

Seventeen per cent believe it will make no difference to the PI crisis while 15 per cent say they do not know.

In recent weeks, Money Marketing has revealed details of two groups working to form captives. One group is based in Gibraltar and the other is on the Isle of Man.

Neither has yet applied for FSA authorisation but both say they would be looking to provide substantial cover to compliant IFA firms.

George Street surveyed 209 IFAs for Money Marketing last month.

Momentum Financial Ser-vices managing director Paul Johnston says: “The theory says yes it would make it a lot easier for IFAs to get cover but I think the practical reality is whether there is the appetite in the market to create a captive at this time.”

Interface Financial Planning director Alan Moran says: “I think a captive would be a positive development for the market but I have reservations about whether it will ever happen. Something has to be done about PI, though. There needs to be a real change of thinking on the matter.”

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