On 1 September 2011, the British Insurance Brokers’ Association (BIBA) and the Institute of Insurance Brokers (IIB) submitted a joint response to the Financial Services Authority’s (FSA) consultation titled “The Financial Conduct Authority: The Approach to Regulation”, which encourages discussion of the new Financial Conduct Authority’s (FCA) approach to its objectives.

In their response (click here for a copy), BIBA and the IIB call for lower regulatory barriers for insurance brokers, to reflect the low systemic risk they say is posed by them. They also recommend greater practitioner involvement with regulation so that the FCA can benefit from brokers’ market experience in keeping on top of new developments, particularly market trends and the risks involved. While they do not advocate radical changes to existing principles and priorities, BIBA and the IIB call for a simplified rulebook, stating that the current FSA Handbook presents “an enormous challenge”. Concluding that disproportionate regulatory oversight will result in fewer firms and therefore decreased competition, BIBA and the IIB urge the new regulator to adopt an appropriate style and intensity of regulation.