Eric Galbraith, chief executive of the British Insurance Brokers’ Association (BIBA), has called on the Financial Services Authority (FSA) to accelerate its fundamental review of the Financial Services Compensation Scheme (FSCS).
Eric Galbraith said: “I am concerned that recent comments by the FSA have shown that the FSCS issue is not as high priority for the FSA as it is for us and our members.
“The recent publication of the FSCS’s interim budget for 2011/12 with a potential further 50% increase in levies for insurance intermediaries highlights once again the fundamental unfairness in the current funding model. It is imperative that the FSA now pushes forward with its consultation process to ensure that a more equitable model is in place for April 2012.
“The huge increase in FSCS levies during the last three years for our sector has been caused by the failure of credit brokers who have mis-sold payment protection insurance. This has nothing to do with insurance brokers and therefore we are demanding that a revised funding model not only removes the current cross-subsidies, but also separates the professional insurance broker from the plethora of ‘secondary sellers’.”
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