Stuart Reid says FSA should take into account the impact of commission disclosure.
The FSA should not underestimate the impact of mandatory commission disclosure on the broking market, according to Venture Preference chief executive Stuart Reid.
The chief of the AXA broking subsidiary said that consumers will ultimately bear the cost of a mandatory regime.
“The FSA may cause massive consternation with its review of commission disclosure,” he has written in an exclusive article for Insurance Times. “It should not be underestimated quite what a threat any changes may mean to all that we do.”
He added: “Despite some cynics’ comments it is not simply a fear that commission will go down. Disclosure undermines the very way our business works and will increase cost for the consumer.”
The FSA has given the market until June 25 2008 to respond to its discussion paper on transparency, disclosure and conflicts of interest. Industry trade bodies are set to meet with the FSA next Tuesday on the issue.
“At this time of rising costs for us all I find it strange that the FSA feels the necessity to embark on this issue, yet again, when ultimately it is the consumer who will pay,” Reid added. He also outlined his plans for integration of the Venture Preference business 18 months after its inception.