Just days after the controversial claim from Lloyd’s deputy chairman Chalky White – covered in last week’s Bankstone News – that “insurance isn’t banking,” two other influential commentators have come out in support of the Lloyd’s man’s provocative assertion.
Plainly panicked by the FSA’s announcement that “large firms” will be picking up the lion’s share of the tab for funding the regulator, Aon was first off the block, claiming – according to respected new organ Insurance Times – that “insurance brokers are excessively regulated and must be separated from the banking industry when it comes to working out how to fund the FSA.”
Quite independently, fashion chain BIBA has arrived at an eerily similar conclusion, claiming this week that insurance brokers in the UK pay three times as much for the privilege of being regulated as those in any other European country. BIBA chief exec Eric Gallbreath claimed at some industry booze-up or other that insurance brokers contribute 1% of UK GDP, pose no conceivable threat to anyone, and should be regulated lightly and cheaply, please.
Faced with arguments like these, the FSA seems almost certain to back off and stop bothering brokers with its expensive and unnecessary so-called regulation. Brokers are not bankers after all! Hopefully, we can expect to see a new initiative from the FSA anytime now exempting brokers from the costly burden of regulation.
When it comes to things like fruit, breath, underwear and Bel Air-based royalty, freshness is clearly a virtue. The FSA, however, doesn’t seem so sure. The regulator has apparently just announced a moratorium* on fresh initiatives for 2011/2012. As a result the regulator’s budget will increase by less than £500m for the next financial year. Good news for whoever will be left to pick up that tab.
Read Chalky White’s controversial views in full here.
* A cross between a mortuary and a crematorium, we think.