It's been a full 12 months since the introduction of Financial Services Authority (FSA) regulation, ...
It's been a full 12 months since the introduction of Financial Services Authority (FSA) regulation, and it's fair to say the market has seen some changes during this time.
Regulation has brought both challenges and opportunities to advisers working in health insurance and protection. As with other markets before it, the regulation of general insurance has meant consolidation and, therefore, a reduction in the number of advisers working in this area.
Although having fewer people trying to promote the need for cover may seem like bad news, this is a real chance for advisers to prove their worth. Although regulation has increased both competition and administrative work, it has also created an environment for advisers to revisit sales. This can, and should, help the market to grow if advisers do their job properly, by re-evaluating their clients' changing needs - particularly in light of the £2.3 trillion protection gap.
Admittedly, as the general insurance market enters the second year of regulation, there are still a few creases to be ironed out. The FSA's primary objectives with the introduction of GI regulation concerned the fair treatment of consumers. Whether this has been achieved is debatable. According to our recent online poll, only one in 10 advisers thought that the increased workload brought on by regulation has in any way increased consumer satisfaction.
But gaining consumer confidence is crucial if the industry is to survive. Consumers are the end user, and gaining their trust is imperative. This is something the industry as a whole must work on achieving together. Could 2006 be the year for doing this?
Angela Faherty, editor
