’The handling [of Gap] has not been the smoothest,’ says partner

Brokers want to be ”brought to the table” when it comes to the FCA making decisions – including those on Gap insurance.

Speaking during a panel session entitled What Next for Brokers at the 2024 Biba Conference, panellists said there were issues with how the regulator communicated with brokers when it came to updates on Gap insurance.

Gap insurance is an add-on to motor insurance that covers the difference between a vehicle’s purchase price and its current market value.

Just two months after the new Consumer Duty rules were introduced in July 2023, the regulator issued a firm statement explaining that it felt the product was failing to provide fair value to some consumers.

And in February 2024, the FCA announced that 80% of the Gap market agreed to pause sales of the product.

The remaining 20% have been told they can continue selling the product for the time being.

Speaking on the panel, Shona Robertson, partner at H&R Insurance Services, questioned the regulator’s inclusivity of brokers when it came to communication.

She explained: “The handling [of Gap] has not been the smoothest. Many of us completed and turned in our fair value assessments last year, which were accepted but no feedback or comments came back to us.

“Yet, to have disruption at the start of this year with the cease on certain products does not make sense.”

She continued: “Furthermore, this was communicated and directed towards insurers – not directed to us as brokers.

“Can we be brought to the table? Can that be shared with us, where is the engagement with us brokers? Where is that transparency? How do we bring back the security we once had?”


The panel was chaired by Insurance Times columnist Stuart Reid, who said that “there is a demand for Gap insurance”.

He continued: “Our jobs [as] brokers is to fill that demand. However, the arbitrary stop means we can not fill in the demand.”

He also spoke about proposals announced by the FCA in February 2024, which would see details of ongoing enquiries into alleged misconduct be made publicly available.

”The firms, which are under investigation, will be made public before any finding of the investigation – which is just bizarre to me,” Reid said.