The Financial Conduct Authority today fined Bluefin Insurance Services Limited £4 million for having inadequate systems and controls and failing to provide information to its customers about Bluefin’s independence in a way that was clear, fair, and not misleading.
Between 9 March 2011 and 31 December 2014, Bluefin, an insurance broker that was wholly owned by insurer AXA UK during this time, held itself out to be ‘truly independent’ in the advice it provided and the insurers it recommended to customers, but "Bluefin failed to implement adequate systems and controls to manage the conflict that arose from Bluefin’s ownership," the FCA stated.
Bluefin’s independence was compromised by its culture, which promoted business strategies, including a policy which focused on increasing the business placed with its parent company, over treating customers fairly. Bluefin brokers did not disclose this policy, so customers risked being misled into believing they were dealing with a broker who would conduct an unbiased search of the market.
"Insurance brokers must promote a culture in which they act in their customers’ best interests and provide them with the information they need to make an informed decision," said Mark Steward, Executive Director of Enforcement and Market Oversight. "This is central to the relationship between the industry and its customers. It is also unacceptable that firms hold themselves out as independent when they are not."
Bluefin agreed to settle at an early stage of the investigation and received a 30% reduction in their overall fine. Without this discount the fine would have been £5,748,200. The FCA said it makes no criticism of any member of the AXA Group, other than Bluefin.