A Bright spark in solvency

I refer to your recent article about the possibility of a 4% solvency margin, as qoted by "a leading regulation expert" and wonder if he is prepared to be named and shamed because. As far as I am concerned, he's talking out of where the sun never shines.

To give you an example, let's say that we have a total brokerage income of £2m. On his basis I would need to maintain £80,000.

But what if £1.5m was on direct debit with insurers? While this is still considered income to my brokerage, I have no control over the collection of premiums.

So how can he justify the 4% on the total. Surely it can only be applied to the remaining £500,000 and therefore £20,000 should be applied.

Richard Mikula
Topaz Insurance

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