The Financial Conduct Authority's annual retail mediation activities return has revealed advice firms paid an average 2% of their revenues on professional indemnity (PI) insurance premiums in 2018.
The FCA's data, which it collects every year from around 12,000 intermediary firms, revealed advice businesses that made less than £100,000 in annual revenue in 2018, which are likely to be 'one-man' bands, paid £2,347 on average on PI cover. As the following table shows, this amounted to 4% of their regulated revenue. PII premiums paid by financial adviser firms While PI premiums stretched the budgets of advice firms - 2018 was the year before the Financial Ombudsman Service compensation limit increased - the FCA revealed more than 96% of firms that have 50 advisers or less made a...
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