The hike in FSA fees has meant a short, sharp and expensive shock for brokers
No apologies for returning to the thorny issue of the massive increases in FSA regulatory fees and levies. Since first highlighting the impact of the changes a couple of weeks ago, we have been inundated with similar stories from brokers the length and breadth of the country. “Dear Insurance Times, normally I would not be the sort of person to write to the press,” wrote one furious broker, “but I have today had my invoice from the FSA, which has gone up from £500 to £1,814 in a year. I am told by my compliance company that there is nothing I can do about it. Is there anything you can do to help?”
Writing in this week's issue, Biba chief executive Eric Galbraith explains in detail how the Biba lobby machine is gearing up to attack the problem. At the end of the year, there will be a full consultation assessing the government’s plans to reform the financial framework of regulation. There is hope that the financial secretary to the Treasury,
Mark Hoban, will understand and appreciate the need for reform to the flawed process to the benefit of brokers. After all, Hoban duly informed us that he used to audit brokers in a previous life when he was pleading for our votes at the Insurance Times hustings event in May. So now is the time for him to put that knowledge into practice and put right the flawed structure of the Financial Services Compensation Scheme.
We need the professional insurance broking sector to be ring-fenced from the rest of the financial sector, or at least be charged proportionally to the risks associated with its role in the transaction by volume and magnitude. And we need a better and more transparent review mechanism within the regulatory process to ensure regulators have a clear sight of the impact of their actions.
Singling out companies and trade bodies to provide limited feedback is simply one route, but it’s clear that this is not always getting the right messages across. We need a formalised process whereby industry practitioners champion our sector to better articulate the extent of the problems and provide clear feedback. And it can’t just be a talking shop. If this coalition government really wants to create a new style of politics, then with this issue it has no better opportunity to embrace business and create a fair playing field for the future.
In the meantime, help us to highlight the extent of the problem and aid the Biba lobby by sending in the details of your disproportionate fees, as well as your proposals for change. IT