Biba demands FCA turn up the heat on authorisations ‘burndown’

As revealed by Insurance Age, in the first 10 months of 2022 it took the FCA 237 days to sign-off businesses’ applications to enter the GI market, far worse than the 174 days hold up in 2021.

Trudgill stated: “237 days is far too long and we need them to respond more quickly.”

Adding: “We have ministers wanting growth and innovation in the sector. It is very difficult to do that when the permissions are taking longer than they did previously.

“I believe the government wants them to respond more quickly as well. It is an important time for the sector during difficult economic times. We need the support of the regulator. They need to do better.”

FOI

The FCA’s data was released in response to a Freedom of Information request by Insurance Age and only ran up to 31 October.

Trudgill indicated he was dismayed to hear that things had been “heading in the wrong direction” for the GI sector at this point.

He made clear: “We need fast, efficient, focused responses that mean we are able to trade and serve our customers. They need, clearly, to act and bring those times down by putting in the resource that is necessary.”

‘Burndown’

The FCA bolstered its authorisation team in 2021/22 hiring two senior directors and 95 staff. In October it committed to adding at least 30 more case officers into authorisations this financial year.

At the same time the regulator noted: “We have introduced ‘burndown plans’ across casework functions, with enhanced triage processes across the different portfolios. This enables us to point this additional permanent and temporary resource to where it is needed most.”

It reported that the caseload for approved person status had declined from its peak of 8000 cases in July 2021 to 2400 in September 2022.

Spotlight

Insurance Age’s FOI shone a spotlight on CEO, chief finance officer and chief risk officer positions at general insurance intermediaries.

It revealed that in 2022 (up to 31 October as detailed by the FCA) including approved and rejected applications it took the watchdog on average 91 days to give a ruling. This was down from 104 days in 2021.

The improvement brought the service in line with the statutory three-month target but only just.

Brokers came under the remit of the Senior Managers and Certification Regime on 9 December 2019 meaning delays have been particularly problematic.

Biba has raised the issue in last year’s and this year’s manifestos calling most recently for the FCA “to further reduce its authorisations backlog for both changes of permission and for start ups”.

Direction

Trudgill acknowledged that the shortening of c-suite delays showed the regulator “seems to be going in the right direction”.

But stressed: “Obviously we still want them to press ahead, make progress and get that right down.”

The FOI also detailed that over the full time period the FCA approved 3321 c-suite applications and rejected a further 42.

The breakdown shows a monthly average of 154 applications being processed in 2021 and 151 last year.

In his view senior roles are really important as “that is the direction of travel of the whole firm”.

While he declined to give specific targets he concluded: “We don’t want there to be long delays and a long backlog. To have what they had before, 8000 was far too many.”

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