Consumers will tend to use an intermediary to help them when choosing and taking out insurance. The services provided by insurance brokers may be provided on both an advised and non-advised basis but will require authorisation from the Financial Conduct Authority (FCA) unless an exemption or exclusion applies.
Insurance brokers that are authorised by the FCA then need to comply with specific rules when providing those services to ensure they maintain compliance. If you are either considering becoming an insurance broker or already authorised as one, you should be aware of the FCA rules that apply.
The rules on how you are expected to conduct your activity can largely be found in the FCA’s Insurance Conduct of Business Sourcebook (referred to as ‘ICOBS’). There are also additional FCA rules that apply to all firms, including the complaint handling rules and rules on the Senior Managers and Certification Regime (SM&CR).
You should also be aware of how the different permissions apply to enable insurance brokers to take different steps when providing their services to customers, such as by providing advice or not. Certain systems and controls should also be in place depending on a firm’s permissions to ensure that they do not breach the rules or operate outside of their permitted activities.
When seeking FCA authorisation you will require a coherent compliance monitoring framework and must be able to demonstrate that the business model is one that meets the FCA’s requirements. You should also be aware of specific requirements that must be satisfied to become authorised including the need for Professional Indemnity Insurance and a minimum capital resource requirement. Those in control or who will have management responsibilities within the firm must also be suitable and appropriate.
Appointed Representatives and Principal Firms
Firms that become authorised by the FCA may extend authorised permissions to third party firms. These are known as ‘Appointed Representatives.
Firms that become authorised by the FCA may extend authorised permissions to third party firms. These are known as ‘Appointed Representatives’. In having an AR, an authorised firm would be understood as the Principal firm. Many firms start as Appointed Representatives before seeking direct authorisation from the FCA.
How can MEMA help you?
Interested in becoming authorised by the FCA or maintaining compliance as an FCA authorised firm? MEMA can help, whether it is for FCA authorisations, or ongoing compliance needs.
If you are looking to become authorised by the regulator , MEMA can help.
Each applicant who works with MEMA is assigned a dedicated Regulatory Director who will support you throughout your application, answering queries you may have relating to the application and providing you with guidance and support.
The process starts with a fact find between yourself and one of our Regulatory Directors where we’ll get to know you and your business and how you intend to provide your services.
We will provide you with advice and guidance on how to comply with the FCA’s requirements and identify any risks.
We will then produce for you a series of documents to support your application and help ensure that you become authorised. These documents include a Regulatory Business Plan and Compliance Monitoring Plan. We also produce a compliance manual for you containing documentation for you to implement into your business upon authorisation to help enable you to comply with the FCA’s requirements.
An online application will then be completed along with all relevant forms, which will then be submitted to the FCA. Should there be any FCA questions, your Regulatory Adviser will work with you to draft a full response.
In short, we’re here for our clients every step of the way. We provide our clients with the benefit of our knowledge and experience to not only help ensure that your application is successful, but that your business has the right foundations to ensure positive customer outcomes.
Ongoing FCA Compliance
As an FCA authorised person or firm, you might need help to ensure you comply with the FCA’s rules.
We provide our clients with support they need to maintain compliance and avoid breaching the rules. Our bespoke service is individually tailored to each of our client’s requirements and objectives to help them meet in the best way possible.
Whether you need documentation to help you remain compliant, want ongoing advice or support, impartial monitoring of your activities or anything else, MEMA may be able to help.
Why Choose MEMA?
MEMA has been supporting firms through the FCA compliance process since 2019. In that time, we have helped hundreds of businesses to successfully gain and retain FCA authorisation.
We have a unique blend of experience from ex-regulators, big 4 consultants and fin/regtech specialisation. Our team is highly experienced and expertly skilled. We specialise in providing our clients with solutions to often complex regulatory requirements and compliance needs.
Our unique industry insight and comfort with compliance enables our team to support you to the fullest extent possible, helping to develop your business model and compliance.