Rwsponse to commission disclosure opinion
The FSA is focused on an epic investigation into commission transparency while neglecting the clear conflicts of interest rising in the insurance market place. An independent broker market is a vital mechanism for the protection of customers.
The genuine price insurance companies receive for carrying risk is shrouded in complex accounts. Excellent broker entrepreneurs saw through the muddle more clearly than most and successfully redistributed price mark-up to their own benefit.
Shareholders’ demands make insurance companies seek to claw back their profits through channel management. Such management involves all the well-tried models, managing general agents, part or whole broker ownership and incentivised loan finance arrangements among them.
While businessmen contest their share of the rich prize of that mark-up over risk price, the customer should be able to rely on the FSA to protect their interests.
True customer protection is much more likely to come from truly independent brokers who better understand and care for their needs. It is unlikely that insurance companies see any cost-benefit merit in supporting a return to an independent free market.
Commoditised products swamped in masses of documents delivered late and full of errors from distant centrally-controlled regimes is not customer protection.
Disclosure or not, just decide so we might better focus our efforts on properly qualified vocational insurance advisers delivering service that customers value.