Letter sent to brokers warning them to strengthen financial resources
The FSA has warned brokers to strengthen their finances in the face of a weak economy.
The message is conveyed in a letter sent to large insurance intermediaries which is also available to smaller insurance intermediaries via the FSA website.
The letter says the FSA is particularly concerned about this issue in view of the continuing challenging business environment. It says that insurance intermediary firms who have not recently undertaken a financial resources assessment should do this, and if they are not complying with the requirement to have adequate financial resources, they should immediately strengthen their financial position. The letter says firms should be in a position to share their current assessment of the adequacy of their resources with the FSA on request.
The requirement for regulated firms to have adequate resources, including financial resources, at all times is set out in Threshold Condition 4 (TC4) in the FSA Handbook.
View the FSA's Dear CEO Letter, right.
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FSA 's Dear CEO Letter
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