Brokers have slammed Norwich Union (NU) for failing to provide enough notice of its intention to cancel agency agreements.
Earlier this year, NU announced it would be writing to 6,000 companies with personal and commercial lines agencies worth less than £40,000 in annual gross written premium in order to cancel their agencies.
One broker said this week that he had received a letter from NU head of broker solutions David Leary, dated 20 October, giving less than one month's notice of NU's intention to close the broker's agency to new business.
The letter said NU would close the agency to new business “with effect from 19
November 2004” and to renewals from 31 December. The broker said this gave him insufficient time to rebroke the business with other insurers.
“They've given me less than a month's notice and this is not conducive to an orderly market,” the broker said.
“I'm placed at a disadvantage because I'm not able to offer full exposure to the market for my clients – I'm not going to have a chance to rebroke the business.”
The NU letter said the insurer was closing the broker's agency to new business because “our records show that you currently write low levels of business with Norwich Union”.
An NU spokeswoman said: “Our standard agency terms are a 60-day notice period and we are obliged to help them place the business elsewhere.”
FSA flogs broker list for £1,000
The FSA will charge £1,000 for firms to view the list of brokers that will be authorised on 14 January 2005.
From November, firms will be able to subscribe to receive regular extracts from the FSA's list on a compact disc.
The extracts will contain details of firms that are on the FSA's register and those that have received a scope of permission notice (SPN). Appointed representatives of a principal with an SPN notice will also be included.
Subscribers will be able to manipulate the data, for example to conduct searches by type of firm or geographical location.
From 14 January, information about which intermediaries are authorised will be available free of charge on the FSA's website.
A spokesman for the FSA said that the regulator was not trying to profiteer from the move. “We need to cover our costs,” he said.