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FSA Regulation Briefing for Van Dealers

Rules for the Motor Trade

Whenever you are involved in providing insurance as part of your business, whether that be discussing, selling or arranging insurance, you will be affected by the FSA regulations. It should be noted that the rules apply across the entire general insurance marketplace and may affect other activities you are involved in, such as insured warranties or tyre and exhaust insurance.

However, because it will become a criminal offence to deal in insurance without authorisation and as the new regulator has the power to sanction firms that do not adhere to their rules, we need to ensure that the new regulations are complied with.

This does not mean that doing business with CVD will be difficult.

So what effect does this have on you?

Here is an overview of the activities you are allowed to do:

1. Marketing and effecting introductions

   Type of activity	Acceptable
   Display of CVD marketing information	Yes
   Recommending CVD	Yes (but see below)
   Providing CVD’s details to the customer	Yes
   Providing details of the customer to CVD	No

2. Pre-purchasing discussions with customers and providing advice

   Type of activity	Acceptable
   Talking to the customer about the need for insurance generally or the need to take out a particular type of insurance	Yes
   Advising on the level of cover needed (e.g. comprehensive)	Yes
   Telling a customer to take out a particular policy	No

3. Negotiating and concluding contracts of insurance

   Type of activity	Acceptable
   Negotiating on behalf of a customer	No

Special note:

Giving our details to your customers is acceptable. However, the FSA will not allow you to give details of your customer to us. Therefore, we will have to talk to them directly, in order to provide a competitive quotation and conclude their insurance requirements.

We look forward to building on our relationship with you and thank you for your continuing support.