The recent Financial Ombudsman Service (FOS) compensation limit hike will see advisers pulling out of the DB transfer market when PI insurance becomes too expensive, the PFS has warned.
On 1 April, the Financial Conduct Authority (FCA) increased the ombudsman's award limit from £150,000 to £350,000. Since the increase, the Personal Finance Society (PFS) has been contacted by financial advisers across the country who have experienced significant hikes in their professional indemnity (PI) insurance premiums. One adviser told the PFS their PI insurance changed their policy limits so that cover would remain FCA-compliant, but would only allow their business to carry out three more defined benefit (DB) transfer cases. After querying the cost to lift this three-case lim...
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