Biba supports FSA crackdown on aggregators

Biba today stressed its support for the FSA’s crackdown on price comparison sites.

The trade body has submitted its formal response to the FSA’s tough new guidance for price comparison sites.

The new guidance, called “Selling of general insurance policies through price comparison websites”, aims to stop aggregators selling unsuitable products and improve customer transparency.

It follows a a hard-hitting FSA report on aggregators released last month.

BIBA’s top three issues that it would like to highlight in order to prevent consumer detriment are:

• The sites must be recognised as more than just introducers, they are arranging, sometimes advising and these activities bring more appropriate regulatory responsibility.

• Comparison sites must provide customers with the relevant information including the disclosure documents. They must ensure their sales procedures are in accordance with the ICOBS rules. They must explain the terms and conditions, ensure the customer’s eligibility, provide status disclosures around suitability of advice and provide a proper statement of demands and needs.

• The practice of ‘pre-population’ of answers with defaults should end.

Graeme Trudgill, Biba’s head of corporate affairs, said: “BIBA agrees in full with the draft FSA guidelines and is keen to co-operate with the regulator and the comparison sites to see these guidelines implemented and supervised appropriately. We believe the cost benefit analysis demonstrates these important changes can be implemented for a relatively small sum.”

Steve White, Biba’s head of regulation and training said: “The full detailed draft guidelines are an important step in consumer protection, they should lead to greater clarity giving customers a better understanding of the products they have purchased and less chance of them buying an unsuitable product. The guidelines should be fully implemented without delay.”