The FSA will release its prudential requirements for brokers in January. But professional indemnity (PI) underwriters are unlikely to alter brokers' rates, until they have ascertained how stringent the statutory regime will be.
An FSA spokesman said he could not reveal how closely brokers' prudential requirements were likely to follow those for IFAs. He said any shortage in brokers' PI capacity, as affected IFAs in 2002, would be tackled by the FSA "when the issue is raised by the industry".
PRI Group chief underwriting officer Peter Matson said brokers had already experienced significant rate and notification increases this year, along with the rest of the indemnity market.
Biba estimated that brokers' PI rates rose by 100% in 2002 and were expected to rise by up to 40% in 2003.
But Matson said he did not expect a knee jerk reaction from underwriters to the publication of prudential requirements.
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