Aifa sets up long-stop campaign - Professional Indemnity Insurance for IFAs

19/11/2009

Written by Neil Pointon

The Association of Independent Financial Advisers (Aifa) is demanding that a long-stop on complaints be created for such financial professionals.

Setting up a campaign that will see it meet with the Financial Services Authority, the Financial Ombudsman Service and consumer groups, Aifa points out independent financial advisers (IFAs) should be able to benefit from the statute of limitations, which provides a legally-binding deadline that complaints can be registered.

At present this is applicable to all industries, with the exception of the financial services sector.

Furthermore, the forthcoming retail distribution review (RDR) claimed that it will not incorporate a long-stop on Professional Indemnity insurance claims.

"IFAs should not be penalised because consumers do not trust banks and want to keep them responsible for their actions. Regulatory actions should be able to differentiate between markedly different sectors," Aifa director general Chris Cummings stated.

He also pointed to research by the organisation which revealed "strong support" among consumers for the statute of limitations to be applied to IFAs.

The publication also indicated that the Ministry of Justice is currently consulting on making changes to the statute which would see the 15-year long stop reduced to ten years.

News of the campaign comes as a study carried out by Aifa in September showed three-quarters of IFAs assessed their business model or intended to do so shortly with ahead of the introduction of the RDR.

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