Brokers' regulatory burden bigger than tax - BIBA

clock • 1 min read

Regulation imposed by the FSA is a greater burden and competitive disadvantage on brokers than corporation tax, the British Insurance Brokers' Association (BIBA) has warned.

The warning comes as the body campaigns for a more appropriate and cost effective regulatory regime to be implemented with the introduction of the Financial Conduct Authority (FCA).

It follows research from BIBA which criticised the current regime as "disproportionate and inappropriate" as costs for brokers in the UK were three times higher than the next most expensive EU state.

Eric Galbraith, chief executive of BIBA repeated his call for the government to ensure the FSA's replacement puts the right regulation in place.

"We have succeeded in persuading the policymakers that the insurance sector is not banking," he said.

"Now we need to get them to understand that general insurance brokers and intermediaries are not insurers. We are not risk takers, we are risk advisers.

"Our members are saying that the regulation burden is a greater competitive disadvantage than the amount of corporation tax they pay," he added.

BIBA members Aon and Marsh added their support saying the cost of regulation is too high as insurance broking does not pose systemic risks to the national economy.

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