After all it is its members who have designed, marketed and profited from many of the products that have caused consumers anguish down the years.
Huw Evans, director general, said proposals by the Financial Conduct Authority “seem to go against the fundamental principles of FSCS funding – that those responsible for the failures are the ones who pay”.
So who was responsible for introducing mortgage endowments, payment protection insurance, precipice bonds and numerous other products that have been at the centre of financial scandals over the past three decades?
When bad advice is given by a bad adviser then every adviser carries the canIt was not financial advisers. Some might have been duped into selling them at marketing seminars run by the insurance industry. Others might have been greedy, putting their own profits before their clients' wellbeing.
It is highly likely that some did not understand what they were selling much better than their client did.
But the relationship between financial advisers and the insurance industry has at times been so tight that some advisers were little more than glorified salesmen for whichever products the insurers fancied marketing.
For the ABI to moan now that products providers are being asked to pay a quarter of costs that fall to intermediaries is disingenuous indeed.
Consider the retail industry. If something goes wrong with a product then my contract is with the retailer.
But the manufacturer is expected to take responsibility if the design is fundamentally flawed. Product recalls and corrections are the responsibility of the manufacturer not the retailer. I did not see many signs of product recalls when it was clear precipice bonds were not working as intended.
Similarly useless PPI insurance was not removed from the shelves because it provided such extraordinary profit margins to insurers.
The FSCS is a form of collective responsibility. Intermediaries who never put a foot wrong are still expected to pay a levy to a fund that compensates the victims of the less-diligent.
There is a strong argument that those who devise products that are fiendishly complex or based more on profiteering than consumer welfare should be expected to share responsibility when things go pear-shaped.
When bad advice is given by a bad adviser then every adviser carries the can – so Mr Evans assertion that “those responsible for the failures are those that pay” does not stand up to scrutiny.
The responsible pay for the irresponsible. That is the principle of a pooled compensation fund. And there is little reason why those further up the food chain should not help out.
Get with it, Nationwide
I am in deep trouble with my nephew and nieces. Some years ago I suggested to their mum and dad that Nationwide was a good home for their money.
Hence all three were furnished with Nationwide Flexaccounts.
Now all three tell me that as far they are concerned Nationwide’s online banking and app are rubbish.
This has a certain irony because at one time Nationwide was ahead of the game, even having its own internet domain. But that was 20 years ago.
My nephew complains that if he forgets his wallet he cannot simply withdraw money using his mobile phone as his friends with other banks can.
One niece told me that when she lost her card she had to actually phone Nationwide. Outrageous! Her friends can do it via their banking phone apps.
And the other informed me that she has not set up Paym for mobile banking payments because you have to go on to the website to do it.
All three hate the card reader needed to log on to the internet banking site.
So Nationwide I offer this advice. Get with it.
You might think your internet banking is up to scratch. But if my nieces and nephew are typical, your technology is just too 20th century.
Car insurance tricks
Car insurance premiums fell 5 per cent over the past quarter – though they are still up 9.7 per cent on a year ago.
I wish someone had told my old insurer that. The quote for my Prius came through about 20 per cent higher than a year ago and my wife’s Audi A3 increase was just as steep.
The letter contained a feeble attempt to shift the blame to insurance premium tax.
After playing the game of calling the company for a better quote for several years I finally decided to shift my business to a different insurer, knocking 30 per cent off my car insurance bill.
No doubt it will try the same tricks next year.
Tony Hazell writes for the Daily Mail's Money Mail section
