24 Nov FSA Quiz Life Insurance Bosses on Rebate Ban
The Financial Services Authority (FSA) have increased the pressure being placed on the pricing models of life insurance companies after the regula tor began questioning platform bosses on whether or not their platform fund manager rebate ban should be extended
to the life insurance industry.
The group is currently examining whether or not excluding the products will lead to market distortion, with a source commenting "[The FSA was] thinking about the difference between platforms and life companies and the fact life companies won’t have a problem with rebates, that they can keep the rebates and fund platforms can’t, and whether that helps them [life companies]."
Andy Maysey (pictured), Investment Management Association (IMA) senior adviser on retail distribution, claims that the company are correct in the investigation, stating that the current model currently punishes funds in favour of life insurance products.
He commented "It is no good doing it [banning fund manager rebates] on a piecemeal basis. If the FSA is going to do it, they should do it across the board.
"Clearly we would like to see parity with the rest of the industry and to some extent it would take some of the complications out of the industry in terms of pricing."