Insurance intermediaries have come under fire from the FSA for having inadequate financial resources.
It has written to the CEOs of insurance advice companies stating its supervisory work "regularly shows" firms pay insufficient attention to threats to their financial viability.
Current FSA rules prescribe both a general solvency requirement and a capital resources requirement on mortgage and insurance intermediaries.
It says it is the first requirement, applicable to all regulated firms and set out under Threshold Condition 4 (TC4) in the FSA Handbook, that is continuing to receive insufficient attention from firms.
The regulator says it is particularly concerned about its findings "in view of the continuing challenging business environment".
In one instance, a firm failed to make adequate provision for its obligations to fund additional pension contributions, causing it a negative net asset position and prompting a capital injection from its parent company.
In another, a company was relying on "intercompany" debts to demonstrate its compliance with the FSA's capital requirements, even though they could not be repaid. Again, additional funding was required.
The FSA says all firms that have not recently done so should undertake a TC4 assessment.
"We will be continuing to engage with firms on this issue and expect to see any firm's current TC4 assessment when asked," the letter reads.
"You should ensure that your assessment is kept up to date and be prepared to make it available to the FSA upon request."
Following Zurich acquisition
Aviva has set out its strategy to launch an investments, savings and retirement division as it seeks to simplify its overall business.
Clients and advisers frustrated by red tape
More than 4,500 retail investors affected
Failure to engage