Responding to a Freedom of Information request submitted by FTAdviser the City watchdog said it was "proactively monitoring" developments in the professional indemnity market, and had undertaken "reactive work in 478 cases relating to professional indemnity insurance for financial advice firms" since the beginning of 2019.
This was despite claiming earlier this year cover remained available for advisers despite coronavirus concerns.
It follows a decision published by the Complaints Commissioner last month which revealed the regulator had allowed an adviser to complete nine defined benefit pension transfers at the end of last year, despite the work being excluded from the firm's insurance.
When asked by FTAdviser the FCA said it would never allow an unfinished advice process to proceed where the adviser lacked sufficient cover, including cases where the client had received advice but had yet to confirm acceptance or return the necessary forms to the adviser.
But the FCA said it did not have a "general approach" where the advice process had concluded and it was the processing of the transaction by the scheme trustees which was ongoing.
The regulator said in this instance it would need to have "full consideration of the wider situation".
The FCA added: "Having a blanket approach would mean preventing those cases that would also involve suitable advice, or where the consumer does wish to continue, and could result in an impact on those consumers that would be acting against their legal authority or intentions.
"Furthermore, it may be the case that the firm is still able to cover its historic liabilities. As such, we need to carefully consider when it would be appropriate for us to intervene to prevent those transfers."
Keith Richards, chief executive of the Personal Finance Society, which has campaigned for an in-depth analysis of the professional indemnity market, said there had been suggestions some insurers were now more cautious following the FCA's decision to ban contingent charging earlier this month.
Mr Richards said: "We have been raising the issue with both the FCA and HM Treasury over many weeks and have offered to pull together a cross-sector review group to undertake a more joined up assessment of the current and future position regarding the level of cover, cost and availability of professional indemnity insurance, as well as the potential consequences for consumers, advice firms and the FSCS, should the market continue to harden.
"I have agreed at a recent meeting with the FCA two weeks ago to continue gathering evidence to maintain the dialogue and have urged them of the need for urgency, intervention and action."
The PFS boss added: "I have had several meetings with PI Insurers and brokers over recent months where it is fair to say that views regarding capacity have been polarised, but at a meeting last week I was told that some insurers are more worried now than they had been prior to the latest FCA rule changes and banning of contingent charging.
"It is important that advice firms take the opportunity to feed evidence of any issues they are experiencing and provide examples of cost, excesses or exclusions to help the FCA gain a more accurate picture – the PFS is also happy to pass on any evidence on behalf of the sector."
Earlier this month the FCA decided it was in the best interests of both the defined benefit market and consumers to push ahead with its contingent charging ban, which is set to come into force October 1.
The issue of professional indemnity insurance has arguably been one of the most contentious issues faced by the advice market in the last year, closely linked by some to the increased compensation limit of the Financial Ombudsman Service and the regulator's crackdown in the defined benefit sector.
Rising premiums and a growing list of policy exclusions are now commonplace in the advice industry, including one adviser who saw his insurance costs rocket by 430 per cent after completing three defined benefit pension transfers over the past five years.
rachel.mortimer@ft.com
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