GISC faces 2004 chop

Insurance activities undertaken by law firms are to be regulated by the Financial Services Authority (FSA) from 2004 after the government has decided to phase out the controversial General Insurance Standards Council (GISC).And as part of transitionary arrangements, the GISC has announced that it will not seek to enforce the rule that only GISC members may deal with other members.

This had raised the prospect of double regulation for law firms which deal in insurance, such as by selling after-the-event insurance.Alison Crawley, the Law Society's head of professional ethics, said: 'We are pleased that it looks as if GISC will remain voluntary in the near future until the FSA takes over.'She said she hoped the FSA would operate a similar regime as it currently does for law firms which are involved in investment activity.Denise Kitchener, chief executive of the Association of Personal Injury Lawyers, said: 'We were always concerned that our members should be allowed to deal with insurers without being forced to join the GISC themselves, and we hope that any plans put forward by the FSA will support this.'Andrew Towler