Norwich Union is to offer motor traders affected by the introduction of FSA regulation professional indemnity cover.
Motor trade underwriting manager, Barry Hogg, said: “As this is the first time that PI insurance has been required by motor traders, there is limited knowledge of the market’s needs.” He said NU was confident it had the skills and capacity to offer its motor trade customers long-term support in this area.
“We estimate that a significant percentage of motor traders are not actively preparing for the impact of the legislation. The FSA themselves have publicly stated their concern at the low level of registration from the secondary intermediary sector, of which motor trade is a key segment,” said Hogg
“It is understandable that the motor trade has not fully engaged with the regulatory process, given all of the issues they currently face in their day-to-day business environment.
Hogg added: “The message for those who still haven’t done any work on this is clear. You need to act now or risk having to stop selling insurance products.
Under the new regulatory rules, a minimum limit of indemnity of €1m per claim will be required for PI cover with an aggregate period limit of €1.5m, or 10% of relevant annual income subject to an upper limit of £30m, unless the company has a comparable guarantee from an authorised firm or group company with net assets in excess of £10m.
