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Dispute causes GISC rethink

The deadline by which dealers had agree to adopt new rules set by the General Insurance Standards Council on the selling of insurance policies has been extended indefinitely due to a dispute involving other industry bodies.

The GISC planned to introduce a rule, known as F42 on October 15 this year which states that GISC members (either an insurer or an intermediary) may only deal with another organisation if it is also a member or is an appointed agent of a member when it comes to selling or recommending insurance products.

This ruling had been given the approval of the Office of Fair Trading. But the Institute of Insurance Brokers and ABTA appealed to the Competition Commission Appeal Tribunal claiming the ruling was anti-competitive.

The tribunal has indicated it will make its ruling at the end of August.

The GISC has decided that, while the deliberations are taking place, to postpone the proposed October 15 commencement date for F42. (and the full implementation date of December 31) indefinitely.

A GISC spokesman said: “If the appeals are rejected we will ensure members are given sufficient time to make the necessary arrangements before the start of the F42 transitional period.

“If the tribunal does not find in the OFT's favour we would expect the matter to be referred back to the Director General of Fair Trading for an exemption decision on our original application.

“GISC members are free to deal with non-GISC intermediaries and should any action which might suggest that intermediaries (whether they are members of ABTA or IIB) are required or expected to apply for GISC membership at this stage.”

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