...but Rolf Tolle is already wielding the big stick at insurers, says Elliot Lane

By February 2004, the FSA will be ready to publish the outline for the future regulation of Lloyd's as set out in CP178.

The regulator will be asking for feedback - maybe based on the wonderfully descriptive "arrow" visits that might be fired at Lloyd's brokers over the coming months.

It is premature to speculate on what the FSA's findings will be, but it is fairly obvious from the GoshawK fallout and the franchise board's recent spirited enforcement that the FSA will want more control.

These were the words of Rolf Tolle last week when asked how he felt about the FSA and its role with Lloyd's.

"The FSA is our regulator, there's no doubt about it. We are not the regulator," he says.

"I'm quite happy that the FSA is the regulator."

So will the Lloyd's franchise board become another GISC and have its powers taken away?

The answer is no.

The FSA does not have the knowledge or skill, or time, to monitor the franchise market.

It needs the hands-on approach that Tolle and his team are currently administering.

Tolle, in addressing the market last week at Lloyd's Old Library, admitted that a "third of plans had to be re-submitted due to technical issues and 42% of plans created major validation problems".

Some managing agents are running their businesses outside the new franchise performance rubric (hence Dex's exit from Lloyd's). And others are still squaring off financial agreements with a plethora of capital providers.

Look out for contracts signed off by some managing agents with about eight signatures at the bottom.