Broking bodies unite to fight commission disclosure regulation.
See analysis: United in the face of adversity
Biba and the IIB have formed an unprecedented coalition in the fight against mandatory commission disclosure.
The trade bodies issued a joint statement exclusively to this week's Insurance Times after uniting at a meeting to discuss the impending threat of more stringent regulation around commission disclosure.
More than two weeks after the FSA’s deadline for responses to its public consultation on commission disclosure and conflicts of interest in the commercial insurance sector, the two bodies were still lobbying for a market-led solution rather than more regulation. Ann Peel, the IIB’s head of technical services, said: “There is a great deal of common ground between the broker trade bodies on this, and the FSA seems receptive to the possibility of an industry solution.”
She added: “If we provide more guidance to brokers to help them address conflicts of interest and to better describe the services they provide, this could help to avoid more regulatory intervention.”
In the statement, both trade bodies said they supported the current requirement to provide details of commission on request. The FSA is worried that this is not enough.
Steve White, head of compliance and training at Biba, said: “We are eager to engage with brokers and liaise with industry representatives to devise suitable guidelines.”
He said the industry should act before the regulator published its feedback to the discussion paper. “We should not wait for the FSA to make the next move,” he said. “Whether or not the regulator decides to consult on rule changes, it is important that the industry takes this opportunity to get to grips with these issues.”
Last month, Biba met the FSA to discuss developing a market solution. They were joined by the ABI, which recently outlined its case against mandatory disclosure to MPs.