Financial Conduct Authority 

FCA board backs smaller adviser market

He added: "I know some firms have the increase excluded, and of course those that don’t have sufficient cover will see their capital adequacy requirements increase. It’s going to be a problem for some, especially those who already have restrictions due to the volume of DB transfer business they’ve done."

Paul Stocks, financial services director at Dobson & Hodge said he struggled to see how a smaller adviser market would bring DB transfer costs down.

He said: "Given the increased potential liability, the cost of professional indemnity insurance will no doubt increase and whilst it’s important advice is appropriate, we need to ensure that ‘good advisers’ aren’t squeezed out of the market.

"I therefore struggle to see how the outcome could be more affordable advice if the cost of running a business increases and the supply of advice is lowered."

carmen.reichman@ft.com