Q&A

Question: We are niche broker for taxi insurance. We have different types of introducers, such as the intermediary who does not want to deal with this class of business and the web-based introducer who only sells the introduction. They refer the business to us without any pre-sale information, and there is no other relationship between us, the client and the introducer after the introduction is made. Are these arrangements covered by proposed FSA regulations?

Answer: If your introducers will be carrying on a regulated activity and it is not an activity that is excluded, then they will be caught by the FSA regulations. The FSA Perimeter Guidance provides an exclusion that could apply to these introducers, in that if their activities are limited to providing information to a potential policyholder, and providing such information is incidental to their main business, they can rely on this exclusion. If they do no more than introduce to you they should avoid authorisation.

Gary Dixon is managing director of Compliance Solutions