Loss assessors must embrace regulation quickly or the industry "will die out", according to Lorega managing director Malcolm Harvey.

Responding to last week's Insurance Times article that the FSA will regulate loss assessors, Harvey said: "The unregulated and unqualified loss assessors don't stand a chance.

"They will be squashed. There are only two I know of which could feasibly carry on."

Harvey added that loss adjusters and loss assessors must introduce a business model structured on fee-based work.

"The industry must begin to change its structure to accommodate the FSA. This means making loss adjusters introduce a fee-based structure. The percentages will be gone, the consumer gets true transparency and the fee should be on a daily rate."

Lorega, formerly Loss Recovery Group, intends to change its business model to charge fees on a per transaction basis for its new broker service.

Called Brokers Integrated Claims Services (BICS), the service provides a complete back office service for the reporting and desktop administration of all non-motor related claims under £5,000.

The service will be 24-hour and allows brokers to use BICS to cover every aspect of their clients' claims service, from notification through to provision of the claims data.

Harvey said Lorega would offer claims and underwriting services, but it was also hoped to offer clients' an alternative dispute resolution (ADR)/mediation service in the near future.