CII and Biba in talks over new broker regulation standard

The British Insurance Brokers' Association (Biba) and the Chartered Insurance Institute (CII) are set to discuss a new broker qualification to fit the demands of forthcoming broker regulation.

The talks, due to be held today, are intended to ensure that the industry presents a united front to the Financial Services Authority (FSA) in discussions over broker regulation, said Biba chief executive Mike Williams.

Williams said Biba regards the CII as the relevant body for the personal qualification of brokers.

He said the Foundation Insurance Test was probably too low a standard for the principals of broking firms and the exams for chartered or associate chartered status were probably too high or inappropriate.

"A qualification somewhere between the two levels is probably the right one," said Williams. He added that this was one of a number of issues on the agenda for today's talks.

Williams said the FSA has indicated that broker regulation will follow a similar pattern to that developed for independent financial advisers. He added that means a minimum basic qualification for practice that could be the equivalent of the FPC3 for IFAs.

The FSA has said that standards achieved in complying with current, voluntary schemes will be taken into consideration when assessing firms' compliance with regulation.

It is understood that grandfather rights will not be recognised by the FSA. Williams backed the proposal. He said that a minimum qualification is required to raise the professionalism of the industry. "Just proving you have 30 years experience shouldn't automatically lead to a broking licence," he added