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The FCA have made a change to the fee tariff data reported on section J of the Gabriel return. Some firms are not aware that the change should be reported on the 2018 annual return.
Previously mortgage and insurance brokers have had to split out pure protection such as life assurance income on the section J return within the Life and Pensions section for the FSCS. The result was many mortgage brokers being hit with higher fees as it was grouped within Pensions.
The change takes effect for the 2019/20 invoicing period, but this is based on annual returns submitted in 2018. For all annual returns submitted in 2018 you should no longer be separating out pure protection income and placing this under SC02 within the Gabriel return. Any pure protection income should be added within the SB02 with any general insurance.
The following can be read on the FCA issued statement: https://www.fca.org.uk/publication/fees-information/fscs-sc02-guidance.pdf
Firms need to be aware of the change in reporting eligible income for pure protection policies. This follows the final policy and rules set out in chapter 2 of our consultation paper CP18/11 ‘Reviewing the funding of the Financial Services Compensation Scheme (FSCS)’. This change takes effect for the 2019/20 invoicing period.
Firms should no longer report pure protection income in FSCS life & pensions class (SC02). Pure protection income should be reported in the General Insurance Distribution class (SB02) for financial year ending in 2018.
Already submitted your annual return this year, simply log in and click on the tick box for section J and request resubmission. This is instant and you can then correct the form and re-submit.
For more information on how we can support your business and ensure it is compliant please contact us.