Rules should be relaxed for letting agents, says insurer

News Category: Industry News

Letting agents should be given a looser rein to discuss insurance with landlords, a specialist insurer has said.

Currently, the only agents allowed to discuss insurance issues must be Appointed Representatives of specialist insurance providers, or be directly authorised by the Financial Services Authority.

The rule was introduced in 2005. Five years on, Michael Portman of Let Insurance Services says so many agents are fearful of the regulations that they do not discuss rent protection insurance – at a time of increasing risk.

Personal bankruptcies are at their highest level for nine years, increasing by 13% in the last year alone, while claims for tenant default are also running at high levels.
 
Yet Portman believes that as few as half of all letting agents discuss insurance against the potential for financial disaster with their clients.
 
The company – which offers agents a path to complying with the FSA – is calling on the Government to come up with a less onerous regulation regime.  

It suggests that letting agents who are members of all the relevant professional bodies should be allowed to offer advice. This would be the same regime that already applies to members of RICS.
 
Portman said: “We believe that regulated letting agents who are compliant with their professional bodies, ARLA, NAEA, NALS and the Law Society, should all benefit from the same exemptions by the FSA as do members of RICS. More advice should be given more freely to all private landlords.”


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