An Appointed Representative (AR) by any other name?

One of the outcomes of the Insurance Distribution Directive (IDD) is the way that Ancillary Insurance Intermediaries (AIIs) are dealt with. This seems to be causing some confusion.

The AII is really nothing new. Many of these who were previously styled “secondary intermediaries” such as motor traders, retailers, travel agents and so forth are now captured by the style AII.

To quote from Policy Statement PS17/21 (pg. 27) –

• In-scope AIIs – Firms who meet the definition of being an AII and are within the UK’s regulatory perimeter. This includes firms within scope of the IDD and firms, such as motor vehicle dealers, within the UK regulatory perimeter but undertaking insurance distribution activities that may be outside of the IDD.

• Connected travel insurance (CTI) providers – Firms, such as travel agents, tour operators and airlines, whose primary business is to make travel arrangements for customers, but who distribute insurance that is complementary to those services.

• Out-of-scope AIIs – Firms who are outside the UK regulatory perimeter by virtue of the connected contracts exemption 10. Common examples include electronic goods and furniture retailers.


So, the main issue is how these are treated in the regulatory world. The IDD now seeks to level the playing field and impose additional requirements on these firms (but I won’t go into that detail here).

This now leads me to the matter of ARs (and IARs for that matter).

It has been commented to RWA that there seems to be a perception that an AII is an AR or at the least, the new name for an AR.

So, the reason for this piece is to clarify the position.

Any AII can be an AR, like any intermediary, if that is how their business works best, after all, insurance is not their prime driver. In fact a good number of these firms are ARs (or IARs), but they can be directly regulated if their particular business model dictates this, or they may even be exempt from regulation.

Therefore, like any insurance intermediary, an AII can be an AR (or IAR) but the mere fact of being classed as an AII does not automatically mean they have to be an AR (or IAR).

Please speak to your RWA Regional Business Manager if you need any further detail

About the author

Terence is the Compliance Director at RWA. He has over 35 years' experience in the Financial Services environment, covering general insurance, investments and mortgages. Before joining RWA, Terence worked for a large PLC insurance brokerage in Manchester, overseeing some 20 acquisitions. He was made a Director of RWA in 2011 and has worked with insurance broking firms of all sizes across the UK. He has a particular interest in Financial Crime and the protecting the insurance broker. Terence is also Executive Chairman of the Association of Professional Compliance Consultants (APCC), the professional body for the compliance consultancy sector.

Terence Clark

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