§ Mrs. Iris RobinsonTo ask the Chancellor of the Exchequer how many independent financial advisers are working across the UK; how many have been unable to source professional indemnity insurance; and what action has been taken by the Financial Services Agency to address the situation within the professional indemnity insurance market. [118062]
§ Mr. BoatengThe Financial Services Authority (the FSA) advise that there are approximately 4,000 directly authorised firms of independent financial advisers (IFAs) in the UK. Between September 2002 and April 2003 just under 2,800 of these were due to renew their professional indemnity (PI) cover, over 1,950 have done so or been granted a waiver of the requirement to have PI.
The FSA is in discussion with the other firms, and works with them to find a solution in light of their individual circumstances.
1092WIFAs may be reluctant to confirm that they have PI cover until they have a policy document, even if they have agreed terms. This means that the reported position can appear less positive than it is.
Last month the FSA authorised a new insurance company that intends to provide cover for IFAs. The FSA also published a consultation paper on its future PI policy in February 2003 and is currently analysing the responses. The FSA is in on-going discussions with IFAs, PI insurers, PI brokers and other interested parties about the situation in the PI market.