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.
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.
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Your key contacts
Ademola is an accomplished consultant with over a decade of experience across regulation, banking, and consumer credit. As MEMA Consultants co-founder, he leverages extensive regulatory expertise to guide clients through critical processes and full compliance. His experience across sectors enables tailored solutions to complex business challenges. Ademola partners with clients as a strategic advisor to help futureproof their business through an in-depth understanding of the regulatory landscape.
Misah is a director at MEMA Consultants with over a decade of experience in financial services. Holding a legal background and postgraduate qualification, she previously worked at the Financial Conduct Authority. Misah has led compliance transformation for global consumer services organisations across Europe, the Caribbean, and Latin America. Her expertise includes implementing compliance frameworks for financial regulations, FCPA, UK Bribery Act, data privacy, and Sarbanes-Oxley. Misah is skilled at advising clients on operational and strategic projects, leveraging her in-depth knowledge of regulatory environments to deliver solutions tailored to complex business needs.