On the road to recovery
Q. Our business has undergone a recent compliance 'health check', which has flagged several areas in which we need to make some changes or improvements to our regulatory practices, which we are addressing. What view might the FSA take if it visited us today?
You have partly answered the question yourself, with the words 'which we are addressing'. The Financial Services Authority is on record as saying that it has no desire to use enforcement other than in cases where there is evidence of either fraud or wilful non-compliance.
Almost 12 months into the regulated environment for general insurance firms, an independent view of where you are now can be a very useful management tool.
You have had a health check, which has given you an up-to-date picture of how your compliance regime looks. You have taken on board the recommendations arising from that health check. Should the FSA come calling today, you can show them all the areas in which you are compliant, the issues that remain outstanding and, most importantly, the steps you are taking to comply.
The FSA approach to regulation is risk-based. Assuming that the way that you conduct your business is not threatening any of the four statutory aims of the FSA, and neither clients nor their money are at risk, then you are likely to find that the regulator would wish to encourage firms like yours to address the issues with an overall aim of improving standards across the general insurance small-firms area.
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