The contribution of the insurance industry to the economic welfare of the country has always been recognised as one of the most important elements in the continuing debate over the regulation of the industry. Of particular interest in recent years has been the position of the person(s) known euphemistically as the “Insurance Intermediary,” which was the subject of a Government paper (its status as Green or White has never been firmly established) early last year.1 The reasons for its publication, and further concern, are noted below in this analysis of the recent, but continuing reform of this aspect of the insurance industry.

After investigating some of the primary “causes for concern” in the public arena of this debate, the more important of the recent regulations introduced under the provisions of the Insurance Companies’ Act 1974 will be noted. Consideration will then be given to the requirements imposed through the United Kingdom’s membership of the European Economic Community, which, when taken with the impetus provided by Government scrutiny of the industry, has provided a spur for a programme of reform to be introduced, and, to a certain extent, already set under way. This has been achieved through the provisions of a Private Member’s Bill, which had full Governmental support—Mr. John Page’s Insurance Brokers’ (Registration) Bill, now an Act, 1977. A note of this Act has appeared elsewhere2 and this article will attempt only to reiterate the more fundamental points concerned with the eventual modus operandi of that Act, and will attempt a comparison with the alternative mechanisms available for a tightening of the procedures which determine the ability of a person to engage in the selling of insurance. Finally, the most controversial lacuna left by the recent Act, (although the Government paper promises legislation on this in due course), the regulation and/or supervision of insurance agents, will be discussed.

The gradual decline of public confidence in the insurance industry generally has resulted partly from specific company failures, leading to substantial losses being incurred by many small, private investors and savers. The most (in)famous of these are probably the Nation Life and Vehicle & General collapses early in the 1970s, when motor insurance policy holders were particularly hard hit. This aspect of failure is probably quite important, given the compulsory third party insurance requirements now imposed by s. 143 of the Road Traffic Act 1972. If a Government