'Hardened' PII market could thaw under FCA capital redress plans

‘Polluter pays’ redress model could improve adviser PPI access

Jenna Brown
clock • 3 min read

The Financial Conduct Authority’s (FCA) proposed “polluter pays” investment advice redress framework, which will force firms to hold capital to cover potential future claims, could result in an improvement to the “hardened” professional indemnity insurance (PII) market, the regulator has said.

The regulator released a consultation on its plans this morning (29 November) alongside a ‘Dear CEO' letter on the issue. It proposed a shake-up to investment advice compensation rules which will see firms set aside capital under a "polluter pays" framework. Capital deduction for redress: personal investment firms could result in firms being required to set aside capital so that they can cover compensation costs and "ensuring the polluter pays when consumers are harmed".  The FCA explained the plans would mean personal investment firms - otherwise known as investment advisers - would ...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Regulation

Moving beyond FG12/16: The evolution of investment propositions

Moving beyond FG12/16: The evolution of investment propositions

'The modern adviser requires a holistic approach'

Karl Dines
clock 21 November 2024 • 4 min read
FCA's Nikhil Rathi registers interest for top civil service job - reports

FCA's Nikhil Rathi registers interest for top civil service job - reports

FCA CEO term to end next year

Linus Uhlig
clock 19 November 2024 • 1 min read
A practical guide to getting ongoing reviews in order

A practical guide to getting ongoing reviews in order

Have you considered file checks on annual review cases?

Jennifer Peaty
clock 19 November 2024 • 6 min read