The Financial Services Compensation Scheme (FSCS) has predicted there will be a surge in the number of complaints against general insurance intermediaries in 2005/06.
In its 2005/06 plan and budget document published today, the FSCS said it was “difficult to estimate with confidence the number of failures or claims.”
But it predicted there would be between 700 and 1,000 complaints in the first year of FSA regulation.
The FSCS also said that the levy paid by general insurers to the scheme would drop by £40m in 2005/6 to £95m.
Insurance intermediaries will be expected to contribute £1.7m to the fund and running costs of the FSCS, the budget forecast said.