Insurers are culling thousands of small-time insurance sellers ahead of the deadline in April next year when the General Insurance Standards Council (GISC) rules come into force.

Axa has taken the lead by writing to 2,500 of its 18,000 agency holders giving them one month's notice and contacting their clients direct. Other insurers admit they are also examining their agency bases along the same lines.

Under the GISC, insurers either have to take direct responsibility for those selling their products or deal only with GISC-registered intermediaries. Axa has identified 2,500 agency holders whose main business is not insurance. It does not want to take responsibility for them and suggests they are unlikely to register with GISC themselves.

"We are getting rid of the butchers, bakers and candlestick makers," said Axa's broker development manager Colin Calder. "It's not a culling of brokers and professional intermediaries."

Axa forewarned the British Insurance Brokers Association (Biba), which reacted positively. "The whole point of the GISC is that it is made up of the whole industry and they would only trade with GISC members. If they can't comply with the GISC, it's unfortunate but those are the rules. If it is getting rid of people who are not going to comply it is important that the rules are followed and adhered to," said Biba's spokeswoman Jennifer Weller.

Axa said it would soon be contacting other related insurance sellers, such as accountancy firms and solicitors, to gauge whether or not they were going to register with GISC. If not, Calder said Axa would pull their agency agreements too.

The GISC said Axa was the most proactive of its insurer members, appointing ex-L&G and Guardian employee Jane Shergold in January this year to identify the impact of the GISC on Axa's business. "If an insurer had identified an organisation that, from past experience, would have difficulty to take responsibility, that is a good thing," the GISC said.

Other insurers admitted they too were looking at their agency bases. Cornhill's Bob Eveleigh said: "We're still evaluating the consequences of the GISC. We don't

anticipate having to cancel swathes of intermediaries as most we deal with are big enough to register with the GISC."

A spokeswoman for Norwich Union said: "We are not going through every single agency yet, but we are talking with some. We are waiting for the finalised GISC standards."

Royal & Sunalliance said it too would act. "We are still reviewing our position on this issue," it said.

Axa's letter to the culled insurance sellers came from company compliance officer Jenny Beeston. The letter said: "Axa have made a business decision only to trade with brokers and full-time professional insurance intermediaries. The em-ergence of the GISC is an additional factor which may in the near future impact on our ability to deal with certain categories of agents."

Calder has said that any intermediary contacted who can demonstrate they are full-time professionals who will cope with the GISC registration should contact him to have the cancellation reconsidered.