Group risk managers have gained exemption from the need for FSA authorisation, said Airmic, the Association of Insurance and Risk Managers.
Earlier this month Airmic obtained councel's opinion which said that: “The UK, by including group risk management companies within the scope of the FSMA 2000 regulations on insurance mediation, has not properly incorporated the Directive into English law.”
A copy was forwarded to the FSA, which has accepted the main thrust of the opinion.
In a letter to Airmic, Eleanor Linton of the FSA, said: “We are grateful to you for sharing this opinion with us which has assisted us in our further analysis.
“We have throughout recognised the force of the policy arguments which you and others have made on behalf of group risk managers and we are pleased that we have also now identified a possible legal basis for deciding that authorisation may not be necessary.”
The FSA have also accepted the principle that risk managers who buy insurance on behalf of their group and then seek to recoup the administration costs from other companies in the group are not receiving remuneration for doing so, said Airmic.
“This is excellent news for UK companies, who would have been put at a competitive disadvantage if risk managers had been regulated,” said Airmic executive director David Gamble.
“We are grateful to the FSA for their flexible and constructive approach.”
