Many small insurance brokers are still bemused by the reams of paper being generated by the FSA. The 300-plus page consultation documents is followed by the weighty final rules. Most would suggest that they have a business to run and wading through such paperwork really isn't a good use of their time.
But is it all that complicated? Could the answer be as simple as putting in place a sales process?
Most organisations in the 'selling game' use a sales process of evaluating the customer, presenting a range of options, filtering and closing the sale. So how many small intermediaries follow this process?
FSA rules now require anyone selling an insurance product to provide information at certain parts of the sale (this will differ depending on the medium used - face-to-face or telephone) so all that is required is for an intermediary to lay down a process for all staff to follow and then undertake regular checks (internal audits) to make sure the processes are being followed.
What should the intermediary do and when? The answers can be found in ICOB 4 Selling and advising and ICOB 5 Product disclosure sections of the Insurance conduct of business rules.
For a typical intermediary selling face-to-face to a retail customer, the sales process might look like this:
Immediately after the conclusion of a contract the customer should be provided with:
Simply making sure that all staff follow these steps and ensuring that at each stage a record is kept will help to ensure that each sale is made in a compliant manner.