My, Registered with the FSA? What were they thinking?

May 07

Note: This article was updated in November 2007 from the original newsletter article. It updates the name of the website, and the types of insurance it provides. Other information has been left as per the May newsletter

Over the last year, I have had a few discussions with the FSA about what I may, and may not, say in the course of this newsletter, my blog, and the various training and information products I have.

The general view was that, provided I talked about investment property and didn’t stray into residential, there was no obligation for me to register with them, since investment property is non-regulated.

However, there were various restrictions imposed by what is called Perimeter Guidance on what I could and could not say as a public speaker on the subject of financing properties. There was an implied danger that people might interpret what I was saying as about their PPRs (which is a regulated market.)

A year ago, I was happy with not needing to register, since I was generally opposed to governments over-regulating people because:

• I believe that most people are responsible adults
• I do not believe we should set laws that inconvenience the many just because of the actions of a tiny few

That having been said, I found the FSA very helpful and easy to deal with, and they have been great about making sure that this newsletter remains compliant.

Last month (April 2007), I became FSA registered!

Do not worry - I have not turned into a mortgage advisor :-)

Part way through last year, I was phoned up by a friend of mine who had an idea for a new business. I spent a couple of afternoons with him, talking through how he might market that business.

Then he met me for lunch, as asked whether I would be prepared to enter into some formal consultancy contract to help them.

I said no. I told him, outright, that I would be prepared to become part of the Board, and become Marketing Director, but that I thought the idea was so good I did not want to be on the sidelines as a consulant. I joined the board in mid-October.

About six weeks later, the Chief Technology Officer decided to concentrate on another business of his, and I stepped in to take over the site development. I can honestly say that it has been a FANTASTIC way to break my retirement, and I am having a ball.

There is an important message about property investment here - because I made enough money in property over the last ten years that I was able to give up the day job, I have been able to get involved in this kind of venture, without an income, because I can say that I will work for a percentage of the business. If I had been relying on my salaried job to support me, I would never have been able to get involved.

There is more to retirement than playing golf (unless that is what you want to do!)

The business is FSA-regulated, and this means that I, as a Director, have to be personally registered myself.

As I’ve been through the registration process, and the training, I have decided that I wish that investment property WERE regulated. I see so many poor-quality courses offered, trying to teach people how to get rich, run by self-styled gurus, that I really wish we were in an industry where there were actually qualifications and licences.

Ouch - whatever happened to the free-market-maven Mark?

The new business is called FabInsurance.com, and it does offer services to Landlords and Property Investors, as well as general members of the public.

The business offers Insurance through a process of reverse auctions. You go onto the site and input your details, both your personal details, and those of your property or your car.

So far, so good, plenty of other sites allow this.

Where we differ is that we do NOT provide instant quotations. Instead, FabInsurance creates an auction - normally for seven days - during which insurance providers can BID for your business. The difference between a bid and a quote is, of course, that in the reverse auction, the providers can see the price they have to beat to win your business.

We have over 90 insurance providers signed up to bid through the system, and the initial feedback from customers (we have only been live about a fortnight) is that they are seeing prices tumble over the seven days, and certainly be very competetive compared to what they have been quoted elsewhere.

You can currently get bids for insurance on:

• cars
• motorhomes
• property, including contents insurance for tenants, and indeed structural and contents insurance for landlords
• vans
• tradesman insurance

This is just the feature article from the May 07 newsletter. Subscribe for market comment, forthcoming events, and more.

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