The Treasury has rejected AIRMIC's request that risk managers be granted automatic exemption from regulation under the Insurance Mediation Directive, which comes into force in January.
AIRMIC chairman David Gamble said in a statement today: "In their letter, the Treasury point out that the FSA have already identified an approach that makes it possible for group risk managers to avoid being regulated. We presume from their comments that they have concluded that no further action need, therefore, be taken.
"AIRMIC is disappointed that the Treasury appears to have missed the point of the request for exemption, which is based around the need for absolute clarity in this matter.
"Whilst the FSA's helpful and flexible attitude would appear to have removed the threat of regulation from the majority of UK risk managers, there will always be a measure of uncertainty unless the Treasury use their powers to grant an exemption. And uncertainty is bad for business."
Gamble added that individual risk managers across the country will now be "obliged to consider the precise legal implications of the FSA's definitions and communicate these within their own organisations and to brokers, insurers and other stakeholders."
"All this takes time that could be better spent on helping their organisations to manage risk," he said.
Gamble said that since the Treasury have already acknowledged that there are no policy reasons for regulating risk managers, it should have granted a total exemption, as is the case in other EU countries.
AIRMIC said it was considering its options and will continue to work with the FSA to clarify the precise position of risk managers in relation to the Insurance Mediation Directive.
