FSA reveals contract certainty penalty options

The regulator is considering capital charges if market solutions fail to impress

The Financial Services Authority (FSA) said it is considering loading capital charges for insurers and brokers as part of a regulatory intervention plan developed to step in if the market’s solution fails to do enough to improve contract certainty. Speaking at an overcrowded lecture at Lloyd’s Old Library at the beginning of January, David Strachan said the FSA “remains reluctant to introduce new requirements” and wants to see the market solution work.