The Financial Services Authority (FSA) advises IFAs that want to offer independent advice to “talk to their professional indemnity insurer at an early stage to ensure cover will be available for all retail investment products” in a newly published FSA guide “RDR – is your firm on track”.
The new guide is designed to help IFAs ensure that their firms are fully prepared for the introduction of the Retail Distribution Review (RDR) by the December 2012 deadline. It covers matters such as meeting the new professional qualification standards, guidance on offering independent or restricted service and fee charging models, as well as the importance of checking PII cover.
“The FSA is spot on with its advice that IFAs check their PII cover,” says James Burgoyne, Director, Brunel Professional Risks. “Different insurers use different wordings and some may exclude financial services products that fully independent IFAs wish to advise on – particularly more technical products such as EIS and VCT schemes, or complex IHT planning advice. That is one of the key reasons for coming to a specialist PII broker like Brunel, as many generalist brokers simply do not have the detailed knowledge needed and cannot advise in these areas.”