Two Barbon executives suspended after FSA crackdown

Two Barbon executives have been suspended following an FSA crackdown on the selling of contents insurance by one of its brands, Homelet.

Insurance Times understands that action against other property brokers could follow.

The FSA requires HomeLet to make sure the letting agents which sell its products do not breach the regulator’s rules.

The regulator is talking to HomeLet about a clause in some letting agents’ tenancy contracts which required tenants to buy contents insurance for their own possessions.

The clause breached FSA and OFT guidelines which state that a tenant cannot be asked to buy their own contents insurance.

There may have a confusion over the guidelines, as a tenant can be asked to buy insurance that covers their landlord’s possessions.

HomeLet, which is responsible for selling of insurance through letting agents, has spoken to all its letting agents and the clause has now been removed.

A HomeLet spokesman said: “HomeLet is involved in a review process which may lead to policyholders with tenants contents policies being contacted about how such contracts were purchased.

“This is a thorough process to ensure it meets the company’s required standards. HomeLet continues to provide insurance products and services to existing and new customers.

“HomeLet is committed to best practice in the service it offers to landlords and tenants via agents.”

Barbon and the FSA refused to name the suspended staff.

HomeLet managing director John Boyle has had one of his directorships terminated, according to Companies House filings. No explanation has yet been given for this development.