The choices facing brokers in the run up to FSA authorisation have never been more bewildering. They can choose direct authorisation or appointed representative status. They can be a member of a netwo ...
The choices facing brokers in the run up to FSA authorisation have never been more bewildering. They can choose direct authorisation or appointed representative status. They can be a member of a network or elect to use compliance consultants, and if so, which one? All this while trying to read and digest the many hundreds of pages of FSA rules - and, of course, running a business.
The question of whether to join a network is particularly vexed. All the networks make claims about the various benefits they offer members, such as extra commission, compliance support, and IT systems. Each network is different, and for a potential member, marshalling this information and coming to a decision is not easy.
To add further spice to the problem, insurers have recently voiced their concerns about the value that some networks add. Royal & SunAlliance corporate business director Brendan McManus has criticised some networks for "overselling" their proposition and not adding "any real value".
The use of compliance consultants is another difficult area for brokers. Consultants are not cheap and brokers need to ensure they are getting value for money. There is also a huge number of consultants to choose from, and while many are well qualified and can provide a professional service, there are some who are less than able.
Making the decision to engage a consultant is not to be taken lightly if the broker wants to ensure that the greatest possible benefits are gained.
It is to help you make these difficult decisions that Insurance Times has produced the Compliance Supplement.
There is an in-depth look at the ten main broker networks (page 15) to help you compare each proposition and decide whether it is right for you. We have also put together a guide to getting the most out of using a compliance consultancy (page 10), and a review of what insurers are doing to help their brokers (page 7).
Hopefully, with the aid of this supplement, the difficult decisions will be a lot simpler to make.
Michael Faulkner
