Hundreds of agencies will have to stop selling travel insurance in January unless they act now to comply with a change in regulations.
The Financial Services Authority will regulate all insurance sales from January 2, replacing ABTA oversight of members’ sales, and agents will no longer be able to sell insurance with a holiday unless they take one of four options.
Yet a survey of 1,500 ABTA agents suggests one in five either do not understand the changes or have done nothing to prepare.
The online survey drew more than 100 responses and the company behind it, World First Travel Insurance, says even small agencies could miss out on £7,000 a year in commission.
The cost of FSA-authorisation makes it a non-runner for smaller retailers, so those planning to carry on selling insurance have to become the appointed representative of an insurer or insurance broker.
Agents may still offer insurance – but not sell it themselves – as an introducer-appointed representative or “unregulated introducer” of a regulated firm. The former involves registering with the FSA and the latter not.
Travel Trust Association members may act as introducers after the TTA announced last week it has obtained FSA authorisation.