The Central Bank has received applications from almost 3,000 insurance intermediaries to continue business under the new regulatory regime. Any intermediaries who did not meet the deadline for applications of June 30th may not legally engage in business from this week.
The number of intermediaries applying for authorisation is significantly lower than estimates published by the Central Bank in April. The bank anticipated that 5,500 firms would register for authorisation by the June deadline.
However, a Central Bank spokesman said there had been no hard in-house figures for how many intermediaries would come under its regulatory framework. The Insurance Act 2000 gave the bank responsibility for regulation in this area from April 1st 2001. The Bank sent out 9,000 application forms to "anyone whose name appeared anywhere". Based on one measure - the number of firms contributing to the Investor Compensation Company - some 5,000 intermediaries were in business this time last year.
That figure included an estimated 1,000 tied agents of insurance companies, who were taken out of the equation because they now fall within the regulatory regimes of the companies they sell for.
Accountants or solicitors who may have provided investment advice or sold insurance products on an incidental basis have the option to seek authorisation from another body and most will not appear on the Central Bank list.
The Institute of Chartered Accountants in Ireland has 550 firms on its books in the Republic authorised to give investment advice. Chief executive of the Professional Insurance Brokers Association Mr Diarmuid Kelly said that with the exception of five retirements, every member of his association registered with the bank.
Those who decided not to register may not have been doing much direct business.
Intermediaries were invited to register with or apply to the Central Bank to do business as either Restricted Insurance Intermediaries, Cash Handlers or Authorised Advisers.
The first level of authorisation is the Restricted Activity Investment Product Intermediary (RAIPI) and initial estimates from the Central Bank indicate that three-quarters of applicants have opted for this level.
RAIPI firms will only be able to provide advice on the products available from the institutions they hold letters of appointment from. Authorised Advisers will provide similar services to restricted intermediaries but will be authorised to advise on a more expansive range of products without having to hold a letter of appointment from the relevant institutions. Authorised Cash Handlers will provide the full range of insurance and investment services, as in the first two categories.
Those who did not meet last weekend's deadline may not engage in any further business until a future application has been fully processed and approved.
