Steve Brockman, director of A2B Mtg Co Ltd, said he had found few insurance companies willing to allow him to sell the protection products to his clients despite the Financial Services Authority (FSA) removing the age and term conditions that had previously restricted its sale.
The FSA has now allowed all long-term insurance policies that do not have a surrender value to be sold under ICOB. Previously, policies were restricted to an upper age limit of 70 and could not last more than 10 years. The changes came into force on 6 June.
Brockman said: “We’ve had great difficulty getting insurance firms to say they can do it. Even though the FSA says they can do it, insurance companies are holding off and there’s a lot of confusion. I think they are all sitting around to see which one moves first. We’re looking at all the firms, but they say they haven’t decided whether they will let anyone sell it.”
Ian Smart, technical product manager for Bright Grey, commented: “The problems are probably down to companies changing their systems, as most had systems that prevented advisers regulated under ICOB from selling the products. The change in rules has made it necessary to change the systems and some firms haven’t been able to do so quickly enough. There’s nothing to stop the IFA advising that it’s an appropriate policy for the client.”
