In the NHS Pensions flexibility consultation document what accrual options are proposed?
a) Anywhere between 20 percent and 100 percent in 20 percent increments
b) 0 percent, 25 percent, 50 percent, 75 percent and 100 percent
c) 50 percent and 100 percent
d) Anywhere between 10 percent and 100 percent in 10 percent increments
The correct answer is D
PI policies require that an insured, in general terms, should notify their insurers at the point at which they become aware that a claim might be made against them. The threshold will be governed by the specific language in the clause and may require notification of matters which â€œmayâ€ give rise to a claim, which are â€œlikelyâ€ to result in a claim or some other variation thereof. The crux of the matter, however the clause is phrased, is that an insured needs to tell their insurers as soon as possible after they become aware a claim/potential claim is in the offing.Â
Whatever the threshold is, it is necessary to show insurers that there is a potential claim out there and there is a reason we need to notify it â€“ ie. something has triggered the need to notify.
With regard to the first point, the Woodford Fund has failed and investors have lost money. This might satisfy the point but insurers will rightly argue that IFAs do not guarantee the success of every investment and those investments can and do fail without any fault on the part of the IFA. An IFA will have established the investorâ€™s attitude to risk, explained the nature of the product and provided appropriate warnings and provided this was done correctly the IFA has no reason to believe they are at risk of a claim. Therefore, whilst regrettable the investment has failed, there is nothing to notify absent any concerns over the sales processes and the trigger point is not reached.
If an insured is concerned they have miss-sold a product to some/all investors they should discuss with their broker/adviser regarding a notification.
The other requirement to notify is in the event of a complaint from an investor (whether justified or not). The policy will be clear on the notification procedure and itâ€™s a fairly straightforward situation.
So, to summarise, absent systemic concerns or specific complaints, I feel it is difficult to justify the notification of Woodford or any other fund based upon the sole fact of its failure.
"Regulatory Approval no longer required"?
Headline from FCA register as about five thousand IFAs leave the FCA register for the first time, and sink into anonymity!
The lack of visibility on the FCA register means that providers are now likely to check that the submitter of business is authorised, by requesting more authorisation from the firm's directors.
This is fantastic news for all IFAs, and although the kitemark of "check me out on the FCA register" is no longer there, so too is the excrutiating pain of Form A's and FCA duplication checks on RIs posted up to be authorised.
The responsibility now belongs to the director.
You can take who you think is right, not who you think might be right for the FCA, and if you think the candidate is good enough for you, then take the responsibility and "be it on your head" as a director if they fail.
This is fantastic news for IFAs.
But the really really good news for DA IFA firms is that this does NOT apply to network members.
So firms that are Network Members are Appointed Representatives, and it will drive them totally crazy to learn that they still must apply the old style FCA rules, and still get their AR RI's approved by the FCA.
Is this a mistake by the FCA legal drafting department? Â
The term AR of course covers half the IFA industry, butÂ
FCA does mention it hereÂ - even if only three times in the entire document!
This gives significant extra leverage for IFA firms who are or will be DA over Network firms.
CF1 AR remains
CF30 for ARs firms remains
If they don't remove this barrier IFAC predict that this will be the end of the network model. Â
After all in future all IFAs could join and simply be trading names, and thus slide under the Form A approval process.