Letters

Letter of the week
A network solution
Following the collapse of Independent Insurance I recently had the unenviable task of calculating many thousands of potential return premiums for our scheme clients, all of whom were underwritten by Independent.

Unfortunately, our technology could not do the job without expensive consultancy and software changes. I did not relish the thought of calculating each one manually.

Then I hit on a potential answer. I had heard Grant Ellis, the managing director of the Broker Network speak at a roadshow in connection with my computer system some years ago, so I gave him a ring. Could he do it yesterday? "Yes."

Now, I have no connection with the Broker Network at all, but they converted my data into a user-friendly format, manipulated it and sent it to where it was needed.

Peter Fletcher
Basic Boat Liability Company
Beckenham

Outsource regulation
We wholeheartedly agree with recent comment in the insurance press and the growing realisation that outsourced providers must now come under regulation. It is the case that some service providers to the Lloyd's Market have have long been regulated by Lloyd's. The supervision of our own managing agency will pass to the FSA. Service providers to the non-Lloyd's market, however, have not been subject to compulsory regulation.

Companies such as ours welcomed the opportunity, provided by membership of the GISC, to demonstrate professional standards and commitment of service to the client, be that client a start-up, operating company or company in run-off.

The FSA has indicated that due credit will be given to GISC members of good standing when the transfer becomes effective. We will pursue our GISC membership and encourage all service providers to the general insurance market to do the same. By so doing we will give a clear indication to the FSA and to our clients that the high standards demanded are demonstrably already in place.

JA Goodwin
Company secretary
Omni Whittington Group

Differences emphasised
Essentially, I am in agreement with Bob Scott's comments (Insurance Times 7 February 2002) that there are huge differences between long term life/investment contracts and general insurance contracts of a year or less.

Hopefully, the FSA will appreciate this when planning its new regulation regime. Perhaps it will also not be too optimistic to think that the FSA has learned lessons from its over-prescriptive approach to the regulation of life assurance.

However, I would also seek to expand on Bob's comments. While he is right that there is no evidence of widespread mis-selling of general insurance, we should not forget that one in eight of all complaints reaching the insurance ombudsman relate to travel insurance. If it is not arranged effectively, elements of a travel policy - like medical expenses or repatriation - can have a catastrophic impact on peoples' lives. Loan protection or redundancy insurance can have an equally serious effect if they are not sold properly.

The non-life industry has one significant difference from the life business. Many policies, like those mentioned above, are sold as an adjunct to a primary sale by organisations where the selling of insurance is only a secondary occupation.

At Groupama Insurances, we believe that it is very important that the FSA understands this. We fully support the ABI in its lobbying of the FSA for a general insurance regulatory regime that promotes professionalism and protects consumers however they buy general insurance.

Colin Darnell
Service Quality Manager
Groupama Insurances

No pain, no claim
My 20-year-old daughter, who is studying in York, was hurt as she walked through the market area of the city. Some wooden panelling being handled by a stall-holder fell across the back of her legs.Later that evening the rest of our family were discussing the matter, when my 15-year-old daughter, remarked: "She should contact Claims Direct."

This comment from my normally quiet, youngest daughter surprised me and supports all of the literature being circulated by insurers in their attempts to justify the sharp increase in liability rates. Based on my experience, rates show every indication of continuing. Would you please pass that bottle of brandy?

Donald MacLeod
Director
Berry Birch & Noble