The British Insurance Brokers’ Association (BIBA) has set out its Budget priorities to recognise the importance of risk management and insurance protection to assist growth and business resilience.
In its submission to the Chancellor, Eric Galbraith, BIBA’s Chief Executive highlighted the value of general insurance brokers in helping both individuals and businesses protect themselves through good risk management and insurance protection.
Galbraith stated that this value is being eroded through inappropriate, disproportionate and costly regulation which impacts both the general insurance broker and their customer. On the change of regulation to the Financial Conduct Authority (FCA), Galbraith said that this was the opportunity to create the right regulation and to recognise the difference between banks, insurers, and general insurance brokers.
In the Budget submission, Galbraith highlighted the failure of credit intermediaries which has led to a devastating 50 fold increase in general insurance brokers Financial Services Compensation Scheme (FSCS) levies. He called for the Financial Services Authority (FSA) to urgently progress its review of what BIBA regards as the fundamentally flawed funding of the FSCS to ensure that general insurance brokers are not paying for the mistakes of others.
Galbraith welcomed proposed action by government on signposting which costs government very little but would be of huge benefit to individuals who might otherwise struggle to access suitable insurance protection.
He also called for Insurance Premium Tax (IPT) to remain at the current level of 6% and to avoid further taxing protection through additional insurance costs for customers at a time when income and business margins are tight.
Galbraith outlined the importance of general insurance brokers in difficult economic times to the chancellor saying: “demand for the services offered by BIBA’s members is greater than ever. BIBA’s members play an important role in helping to ensure that individuals get access to the insurance suitable to their needs.” He also explained the key role of brokers in the sector “contributing 1% to GDP” and “employing more than 100,000 people.”