The very regulations designed to protect consumers and stabilize the market are now being cited as the greatest risk to the economic resilience of the United Kingdom’s insurance brokerage sector. This startling paradox is at the heart of the newly unveiled 2026 Manifesto from the British Insurance Brokers’ Association (BIBA). The document serves as more than a policy paper; it is a clear-eyed declaration from an industry at a breaking point. Framed around a 10-point plan for “economic resilience,” the manifesto articulates a widespread sentiment that brokers are being stifled by an ever-growing accumulation of complex, outdated, and disproportionate rules. It represents a collective call for a fundamental reset, arguing that without significant change, the sector’s ability to support clients and contribute to the broader economy is in jeopardy.
When the Cure Becomes the Complaint
A central pillar of BIBA’s argument is that the current regulatory framework has become counterproductive, layering complexity upon complexity to the point of absurdity. Industry experts point to two primary sources for this administrative bloat: the Insurance Conduct of Business Sourcebook (ICOBS) and the Product Governance (PROD) rules. The fundamental flaw, critics argue, is the “layering effect,” where rules designed for the consumer retail market have been inappropriately applied to the distinct world of commercial business. This mismatch forces commercial transactions through a consumer-centric lens, creating procedural hurdles that add little value.
This frustration has culminated in a demand for a complete overhaul rather than incremental tweaks. The sentiment is captured powerfully by Jill Hambley, managing director at UKGI Group, who states, “If you were to start from scratch, you wouldn’t write those rulebooks the way they’re written now.” BIBA’s manifesto translates this call for a blank slate into a concrete proposal: a new Financial Services Bill. The explicit goal is to simplify the Financial Conduct Authority (FCA) rulebook and, critically, to eliminate the regulatory duplication that places a redundant and costly burden on firms of all sizes.
The Lingering Shadow of Consumer Duty
Despite its noble intentions, the implementation of the Consumer Duty continues to cast a long shadow of operational strain and ambiguity over the brokerage sector. A significant level of confusion persists, particularly around the practical application of fair value assessments. This lack of clear guidance creates a climate of uncertainty, forcing firms to navigate a complex set of expectations without a clear map, which in turn leads to inconsistent approaches and increased compliance costs.
This problem is compounded by what Hambley describes as a “platinum-plated approach” from some insurers regarding data requests. Brokers report being inundated with demands for information that insurers often already possess, leading to a massive duplication of effort. For a typical broker managing hundreds of insurer relationships, this redundant workload consumes valuable resources that could otherwise be dedicated to client service. This dynamic raises serious questions about the market’s ability to strike a sustainable balance between delivering excellent customer outcomes and maintaining operational viability under the current framework.
A Call for Proportionality and Common Sense
The manifesto makes a forceful case against the “one-size-fits-all” model of regulatory reporting, which imposes excessive demands on the vast majority of stable and compliant firms. The current system requires a deluge of data collection that many believe is disproportionate to the actual risks posed by most intermediaries. This approach fails to distinguish between high-risk entities and the stable firms that form the bedrock of the industry, treating all with the same level of intensive scrutiny.
In response, BIBA and industry leaders are advocating for a smarter, risk-based supervisory model. Such a framework would concentrate intensive oversight on firms operating near their capital resource thresholds or otherwise identified as high-risk. For the rest, a streamlined process, such as a single annual report aligned with a firm’s accounting period, would suffice. This shift toward proportionality is not just about reducing administrative tasks; it is a strategic move designed to ease the immense pressure on small and medium-sized firms, freeing them to focus on innovation and growth.
Closing the Guidance Gap for Smaller Firms
While large corporations may have the resources to navigate regulatory ambiguity, smaller intermediaries are disproportionately affected by the current outcomes-based system. Lacking extensive compliance departments and legal teams, these firms face a “guidance gap” that makes it challenging and expensive to interpret vague rules with confidence. This uncertainty often forces them to err on the side of extreme caution, leading to higher operational costs that ultimately impact their competitiveness and the clients they serve.
To bridge this gap, there is a strong call to reintroduce high-quality, prescriptive guidance documents that offer clear, actionable instructions. Citing former handbooks on client money and financial crime as models of best practice, experts argue that such resources would significantly reduce compliance costs and complexity for smaller firms. In line with this, BIBA has committed to developing new practical tools for its members, including updated guidance on the Consumer Duty and a standardized fair value assessment template, both aimed squarely at empowering smaller brokers with the clarity they need.
The Long Road from Manifesto to Mandate
While BIBA’s manifesto has been widely praised for crystallizing the industry’s frustrations, there is a cautious outlook on the prospects for immediate change. The path to reform is notoriously slow, often mired in the bureaucratic “backwards and forwards between the FCA and the Treasury,” as Hambley notes. This reality tempers any expectations for swift relief, suggesting that the industry must prepare for a sustained advocacy effort rather than a quick victory.
However, the manifesto’s value extends beyond its specific proposals. It has successfully ignited a critical conversation and given a unified voice to thousands of brokers. Even with a critical eye on areas like diversity and inclusion, where some feel progress has been too slow, the consensus is that BIBA’s initiative is a vital first step. The challenges of a complex and burdensome regulatory system had been laid bare, creating an undeniable mandate for change that regulators and policymakers would now find difficult to ignore. The dialogue had begun in earnest, marking a pivotal moment in the industry’s push for a more resilient and rational future.
