’Thanks to our tougher rules and new reporting requirements, we have been able to take increased action,’ says director of insurance

The FCA has placed 10 firms under restrictions for failing to meet the regulator’s expectations on appointed representatives (ARs).

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Read: FCA confirms new rules on oversight of appointed representatives

Read: What will new regulations for appointed representatives mean for the industry?

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In a statement released yesterday (15 June 2023), the regulator revealed that four of these companies were from the insurance industry.

It comes after the FCA confirmed new rules to make firms more responsible for their ARs last year (8 August 2022).

As part of these new rules, regulated businesses are required to action enhanced oversight of their ARs – including ensuring that they have adequate systems, controls and resources – and must provide complaints and revenue information for each AR to the FCA via annual reports.

The FCA also created a new supervision department, which has more than 30 staff, to raise the standard of oversight.

“Thanks to our tougher rules and new reporting requirements, we have been able to take increased action against firms who manage ARs for failing to meet our expectations,” Matt Brewis, director of insurance at the FCA, said.

Engagement

An AR refers to an individual or firm that operates within a regulated industry.

Read: The types of insurance most complained about in the last financial year

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Rather than being directly authorised by the FCA, ARs act as agents for a firm that is authorised, which is referred to as the principal.

The FCA has written to over 3,000 principals about their obligations to oversee the behaviour and conduct of their ARs.

The regulator is also collecting data on every AR, across the breadth of financial services, which it said was helping identify where consumers may be at risk of harm.  

“We will continue to engage with principals on the new rules so they’re aware of what they and their ARs need to do to remain in the market,” Brewis added. 

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