Coming…ready or not!

The Financial Services Authority’s new mortgage regime will be here before we know it (on 31 October), and the new insurance mediation regime comes into force just a few months later (on 14 January). So there’s not much time left to ensure full compliance with the FSA’s insurance mediation and mortgage regime. Emma Radmore and Sara MacKenzie of Denton Wilde Sapte highlight a number of areas where practical compliance with the FSA’s requirements may not be easy, even for firms who are already authorised and familiar with the regime.

Sales

Both the insurance mediation and mortgage conduct of business rules (ICOB and MCOB) distinguish between advised and non-advised sales. Note, though, that their provisions are not identical. On the face of it, this seems a simple enough concept: some firms will give clients advice and some will merely provide information. Logically, since it is the riskier business to conduct, firms must comply with additional requirements when advice is given; it has, for example, to meet the “suitability” test and staff involved in advising clients will need to achieve the levels of competence required under Chapter 2 of the FSA’s Training & Competence Sourcebook (T&C), in addition to the basic Chapter 1 “Commitments”.