FSA to exempt certain Holloway policies from RDR

The FSA is proposing to exempt certain Holloway sickness policies from the retail distribution review (RDR), as part of its latest quarterly consultation issued today.

The regulator says the RDR’s rules on professionalism and adviser charging should not apply to advice on some of the policies, which combine income protection insurance with an investment element.

The consultation says: “We are proposing an exemption for those Holloway policies with a small investment element.

“Following discussions with the Association of Financial Mutuals, we are consulting on a threshold where the projected maturity value contained in the key features illustration is 20% or less of accumulated premiums, using the mid-rate projection of the Holloway provider.”

The regulator has asked for feedback to be submitted before March 6. (article continues below)

Elsewhere, the FSA is also proposing to add further qualifications to its recognised list for advisers under the RDR.

The qualifications relate to two RDR activities, advising on packaged products and friendly society tax-exempt policies, and managing investments or acting as a broker fund adviser.

They include the diploma in investment planning offered by the Chartered Institute of Bankers in Scotland, which is examined in a work-based assessment format.

The FSA has requested responses by February 6 on the additional qualification plans.