ABI victory on protection insurance regulation is good news for consumers

ABI victory on protection insurance regulation is good news for consumers

ABI victory on protection insurance regulation is good news for consumers

Today’s announcement by the Financial Services Authority that it is to apply the same regulations to the sale of life, critical illness and income protection insurances where there is no investment will benefit many consumers, and older people in particular. Following pressure from the ABI, the FSA has agreed that, apart from long term care insurance, all other protection insurance that has no investment element can now be sold under the standard insurance rules, rather than the more complex investment rules. In particular, this will make it easier for a wider range of people to have ready access to plans with life cover.

Nick Starling, the ABI’s Director of General Insurance and Health, said:

“This positive move by the FSA will benefit many customers, especially older people. We are pleased that it has listened to our arguments.

“People now live longer, have a longer working life and start families later. Rising house prices mean many have to spread their mortgage payments over a much longer term. For all these reasons, the need to have life cover at older ages is increasing.

” Until now it could be difficult for older people to buy life cover alongside a product such as a mortgage, because the adviser was not qualified to sell products under FSA investment rules. Today’s decision will make products such as life insurance, which already provides valuable peace of mind for millions of individuals and families, more convenient for a wider range of people.”

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Notes for Editors

1. The ABI is the trade association for Britain’s insurance industry. Its nearly 400 member companies provide over 94% of the insurance business in the UK. It represents insurance companies to the Government, and to the regulatory and other agencies, and is an influential voice on public policy and financial services issues. ABI member companies hold up to a sixth of all investments traded on the London Stock Exchange, on behalf of millions of pensioners and savers.

2. An ISDN line is available for broadcasts.

Copies of all ABI news releases, together with other information from the Association, can be seen on our website http://www.abi.org.uk

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