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During a panel debate held at the 2009 Protection Review conference, Nick Kirwan head of health and protection insurance for the ABI, said he had concerns that wealth managers may use protection to avoid switching to a fee-based business model.

Just hours after the FSA published its RDR consultation paper, a panel of leading industry experts offered their thoughts about the impact a fee-charging environment may have on protection sales.

Last week's consultation paper by the City watchdog raised fears that some advisers may shift their focus towards the sale of protection policies in an effort to chase commission income post-2012, when reform of the sector is to take place.

Alan Lakey, director of Hertfordshire-based IFA Highclere and a delegate at the conference, said: "My understanding is that the FSA is going to place a scrutiny of those wealth managers who it fears are going to move across to protection in order to gain commission.

"Is it just me that finds it intrinsically bizarre that as an industry we are trying to encourage the take-up of products, and it sends the dual message that firstly the FSA is out of touch with the reality that the products need to be sold and, secondly, that without any shadow of a doubt, advisers will move across the RDR concept to protection."

Mr Kirwan said he believed some aspects would eventually be brought across to the protection industry.

In the meantime, he said there could be a situation where investment advisers operating under the new rules would also be selling protection based on the existing regime.

He said: "The FSA's concern is about how those two products will sit side-by-side together and how the old and the new rules may somehow distort the advice process.

"Will the adviser who is no longer able to receive commission from investment products, because commission is banned, try and hide their remuneration behind undisclosed protection commissions?

"The last thing we want is to mis-sell protection products, we really do not need a protection mis-selling scandal, that is the last thing we need."

However, Kevin Carr, director of protection development for PruProtect, said he thought it was difficult to mis-sell protection and that it was unlikely that there would be a negative outcome for the consumer.

He said: "If someone has got too much critical illness cover is that necessarily a bad thing?

"I mean the worse thing that could really happen is that you could sell income protection to someone that already has it through their employer. Some people actually do that anyway because they realise they would lose it if they lost that employer."