Q&As

What are the consequences for law firm of breaching the insurance distribution regime?

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Published on LexisPSL on 14/11/2018

The following Practice Compliance Q&A provides comprehensive and up to date legal information covering:

  • What are the consequences for law firm of breaching the insurance distribution regime?
  • Breach of SRA Handbook
  • Formal enforcement
  • Informal enforcement
  • Breach of the underlying Insurance Distribution Directive
  • Breach of the FCA exempt professional firms regime

Failure to comply with the insurance distribution regime could represent a breach of the:

  1. SRA Handbook (the Financial Services Scope and Conduct of Business Rules form part of the wider SRA Standards and Regulations), and/or

  2. underlying Insurance Distribution Directive (IDD)

  3. exempt professional firms (EPF) regime

Breach of SRA Handbook

The SRA's enforcement teams have a variety of powers and tools at their disposal. These can be divided into two broad categories: formal and informal.

Formal enforcement

In relation to a solicitor, other authorised lawyer or firm, the SRA has powers to:

  1. issue a formal warning and recover costs

  2. impose a disciplinary sanction and make a costs order

  3. control how the individual or firm practices

  4. intervene in the firm

  5. enter into an agreement (a regulatory decision made by the SRA and accepted by the individual or firm)

  6. issue a rebuke and/or impose a financial penalty of up to £2,000 (or £250m for an ABS)

  7. ma

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