AIRMIC is unsatisfied about the level of transparency of broker commissions
AIRMIC finds it unsatisfactory that, nearly 10 years since it first raised the issue of transparency of broker commissions, disclosure is only voluntary and not universal throughout the broking community, representatives of the association told a hearing of the All Party Parliamentary Group on insurance and financial services.
AIRMIC insurance steering group chair Kip Berkeley-Herring, chief executive John Hurrell and technical director Paul Hopkin told the MPs that AIRMIC’s view was straightforward: the disclosure of commission should be automatic.
The Financial Services Authority (FSA) has asked the insurers, though the British Insurance Association (ABI), and brokers through the British Insurance Brokers’ Association (BIBA) to find a solution, but the issue appears to have been divisive and resolution is not immediately in sight. ‘In a word,’ said Hopkin, ‘we are waiting.’
The APPG has held several meetings on commission disclosure, hearing a variety of views from insurers, brokers and buyers. As these presentations were split across the Parliamentary summer recess, it was impossible to hear from everyone in time to make a submission to the FSA. The group has decided to wait until the FSA publishes its review of the responses and, possibly, meet the FSA in the new year.