Jeff Herdman in drive to ensure fairness within the Industry
Oval is taking a front seat in the campaign to lobby the FSA for fair fees.
Brokers are very concerned that the FSA has decided they should be liable for compensation for mis-sold payment protection insurance (PPI) policies, which has resulted in eight-fold increases in FSCS (Financial Services Compensation Scheme) fees.
Last week, Insurance Times launched an online petition for brokers to register their support for their ‘Fair Fees: Brokers won’t pay for banks’ campaign. Jeff is seen here, helping to drive the campaign at Insurance Times' Broker Forum meeting. Over the past two years, GI brokers have faced a 48-fold increase in their annual levy to the Financial Services Compensation Scheme (FSCS), on top of a doubling in the minimum FSA fee.
The campaign calls on the FSA, when it reviews the FSCS, to:
- ring-fence professional insurance brokers from the rest of the financial services sector when establishing the new FSCS framework;
- exclude the mis-selling of payment protection insurance (PPI) from the compensation scheme for professional brokers;
- ensure that the fees and levies paid by brokers are proportional to the risks they generate; and
- protect professional brokers from having to pick up the tab for the failures of the wider financial sector.
The FSCS’s annual report for 2009/10 lays bare the impact of PPI mis-selling on the compensation scheme for general insurance intermediaries.
It shows that the vast majority of the compensation claims being paid out from the scheme’s GI intermediation pot were related to PPI. Over the last year, the volume of claims not related to PPI fell by a half.