Firms and professionals who are engaged in general insurance distribution activities as part of their offering must be licensed and regulated by a scheme approved by HM Treasury under the Financial Services and Markets Act 2000 (FSMA). The RICS Designated Professional Body scheme (DPB) is one of these approved schemes, enabling us to regulate our members for general insurance distribution activities in the UK, on behalf of the Financial Conduct Authority.
If you are an RICS-regulated firm and you provide insurance distribution services, but it is incidental to your surveying services, you can apply for a license for this activity through RICS, instead of the FCA. Only RICS-regulated firms can join this scheme and be regulated by us under it.
How the process works
Be an RICS-regulated firm
To be licensed by us under this scheme you must be an RICS-regulated firm and insurance distribution cannot be your main firm activity.
FCA cancellation process
If you are already directly authorised by the FCA, you must complete the FCA cancellation process before you apply for a DPB licence.
Apply for the DPB scheme
Read and comply with the DPB rules and guidance. You must then apply for the DPB scheme through the regulation section on ‘My account’, and pay the relevant fee.
Closing your scheme registration
If your firm no longer conducts DPB Regulated Activities you must submit a surrender licence form.
Related resources, if you are currently, or are considering, being licensed for general insurance distribution activities
DPB Rules and Guidance
The DPB Rules cover the relevant regulated activities under this scheme for all firms who are licensed under it. Compliance with these rules is a legal requirement.
The rules are shared here, as well as accompanying guidance to assist RICS-regulated firms and members in complying with the regulatory requirements of being licensed through the RICS DPB scheme.
Compliance and best practice
RICS routinely carry out regulatory review visits of firms that are registered under the DPB scheme. This helps ensure that firms are following the DPB rules, and their legal obligations, under registration for general insurance distribution.
Issues with client commissions
As part of our regulatory assurance work, we have found cases where firms pay commission into their office account without first obtaining written, informed client consent.
Under the DPB Rules 2018, firms must obtain written consent before keeping any commission. Until consent is received, or the money is passed to the client, commission should be held in the client account.
Our reviews have identified instances where firms retained significant sums without entitlement. Where this occurs, firms must transfer the commission to the client account and either return it to the client or obtain their written consent to retain it.
Failing to comply with this requirement under the DPB Rules puts the firm in breach of the Rules of Conduct, which could lead to disciplinary action against the firm or individuals. In more serious cases, the firm may face restrictions, suspension, or even withdrawal of its DPB licence.
How can firms put things right?
If you are concerned that your firm may not have obtained written informed consent on commission earned under their DPB licence, you should take immediate action to avoid disciplinary action. You should take the following steps:
- Make a schedule of all commission earned since the firm's licence was granted.
- Check whether written informed consent has been obtained on each commission. This means that the client must know the amount of commission earned and agree that the firm can retain that commission.
- On all commissions that have been retained without written informed consent, pay the monies to the firm's client bank account.
- Either obtain written informed consent to retain the commission or remit it to the client.
It is a requirement to keep a record of all commission earned, the amount and the date on which written informed consent was obtained.
If you are unable to complete the steps above, you need to report this to us using the form below:
Any questions? Check our FAQs page or contact the regulation team on regulation@rics.org.
Free online training and webinars
The regulatory functions of RICS are led and overseen by the Standards and Regulation Board (SRB).