The Institute of Insurance Brokers (IIB) is not waiting for the Office of Fair Trading to make a decision about general insurance regulation, its director general Andrew Paddick said this week.
Instead, the trade body will go ahead with the process of nominating the board for its own regulatory body within two weeks.
Letters will be sent to brokers asking them to nominate six out of the 13 board members. Each nominee will need ten votes of support.
Meanwhile, the OFT is still deliberating over whether insurers will be allowed to cancel agencies for brokers and intermediaries who do not sign up to the General Insurance Standards Council (GISC), the newly formed regulatory body that the IIB opposes.
The move would effectively coerce all intermediaries and brokers to join the GISC or go out of business.
But Paddick defiantly says that the OFT decision will be irrelevant if enough brokers join the IIB's alternative regulatory body.
“Even if the OFT grants insurers the power to cancel agencies for non-GISC members, insurers will not exercise that power if brokers are members of a better regulatory regime,” he said.
“This is business and no insurer is going to shoot themself in the foot.”
Paddick says he needs to start the process for setting up the IIB's alternative regulatory body, which is based on the current statutory body the IBRC, by April 30. This is the date the IBRC will be scrapped.