Jlt Risk Solutions and the Futures and Options Association have developed a new legal expenses cover for company officials responsible for monitoring regulated financial activities.

The policy is specifically designed for company officials called on to defend potential proceedings brought by regulatory bodies such as the Financial Services Authority.

These officials, known as Approved Persons by the FSA, can obtain the cover from the FOA, the industry association for firms operating in futures, options and other derivatives that has 180 members.

The policy is valid for all categories of a company's regulated activities carried out in any part of the world.

Claims are capped to £500,000 per Approved Person per year, but additional levels of cover can be obtained for higher premiums.

FOA chief executive, Anthony Belchambers, said that in inviting JLT to devise the policy, the organisation was responding to concerns expressed by FOA members over increasing regulatory risk.

Graham Fox of JLT said: “Legal costs and expenses arising from an action may well be substantial.

“The new policy will provide cost-effective protection for all Approved Persons.”