The threat of fines or being barred from doing business under the FSA’s rules regarding broker-insurer trading arrangements can be avoided with the help of a new online tool from Norwich Union.
The threat of fines or being barred from doing business under the FSA’s rules regarding broker-insurer trading arrangements can be avoided with the help of a new online tool from Norwich Union.
The Broker Regulatory Risk Tool allows intermediaries – at no cost - to assess the level of risk and value presented to them by a variety of different trading methods and incentives.
Once the broker has awarded a score for each arrangement, the tool then shows the level of possibility that a particular incentive might lead to non-FSA compliant activity – depicted in a “red-amber-green” format to show the level of danger.
Common trading choices covered by the tool include profit share, over-riders, receiving loans from insurers, the impact of having on-site underwriters, etc. The FSA principles at stake for the broker are treating the customer fairly, conflicts of interest and integrity.
Simon Bloomfield, broker proposition development manager at Norwich Union, says: “Just because something is considered to be a ‘market practice’ does not mean that it is going to be compliant and the online tool is aimed at helping brokers to manage the potential regulation risks that they face.
“And it is important to remember that the type of arrangement is not the sole issue; the systems and controls that a broker uses to ensure the arrangements are not used inappropriately within their business are equally important.”
He adds: “Brokers obviously know that it is possible to fall foul of the FSA and, in extreme circumstances, they could be disallowed from trading. What we are doing through the regulatory risk tool is trying to make brokers aware of the potential risk that their business faces, so they can make the necessary arrangements to eliminate them or manage them appropriately ”
The regulatory risk tool can be found at: www.norwichunion.com/ebroking/business_advisor/fsa_regulatory_tool.htm
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For further information, please contact:
Jon Clements at Staniforth on 0161 274 0100/07989 414486
Sally Leeman at Norwich Union on 01603 684225/07800 699670.
Notes to editors:
About Norwich Union Insurance
- Norwich Union is the UK's largest insurer with a market share of around 14 per cent
- With a focus on insurance for individuals and small businesses, Norwich Union insures:
- One in five households
- One in seven motor vehicles
- Around 800,000 businesses - Norwich Union products are available through a variety of distribution channels including brokers, corporate partners such as banks and building societies and Norwich Union Direct.
- Aviva, Norwich Union’s parent company, recently announced its acquisition of the RAC. The acquisition brings together the RAC's powerful brand and customer base with the expertise and leading position in motor insurance of Norwich Union Insurance.
- Norwich Union's news releases and a selection of images are available on the Aviva internet press centre at www.aviva.com/media.
- An ISDN facility is available for studio quality broadcast. Call the press office on 01603 682264
Norwich Union Insurance Limited Registered in England No 99122.
Registered office: 8 Surrey Street, Norwich, NR1 3NG
Authorised and regulated by the Financial Services Authority
Member of the Aviva group.