FSA rules for car insurance affiliates - easy guide?

[oliver1]

Hi. I've been trying to find a 'dummies guide' that can explain the dos and don't for affiliates in the finance sector with regards to FSA regulations/legislation.

I think the general idea is not to provide personal recommendations unless you are a registered financial advisor, but finding actual hard facts on what can and cannot be said is proving tricky. The area I'm thinking of specifically is car insurance although wider info about loans/credit cards etc. would be interesting.

I've tried Googling various phrases and I've dug around this forum and the FSA website but still nothing concrete, so I would be very grateful if anyone could post a link to a page on this or PM me.
Thanks!
Oliver

[drivetowin]

I don't know that there is a 'dummies guide' as such but you have got the general idea right - you must not do anything that implies a recommendation - which means don't pick one provider as your 'provider of the day/week/month' etc - don't display one in larger text than another or a different font or even a different colour (though alternating colours down a page seems to be ok).

[oliver1]

Thanks drivetowin, for your tips. That's pretty much what I thought and it's a good start. I was wondering what you are basing that on though? I'd really like to track down the actually official wording on the regulation/legislation from the FSA so that I have a solid base to work from. I understand that if you screw this up the penalties can be severe so I definitely want to make sure I've made the effort to read the 'official line' on it.
Hopefully someone on the forum can post a link or PM me with the full details on these rules for finance affiliates? Thanks for reading.

[magenta]

I don't think there are rules as such for affiliates, remember you are not offering the product, rather you are just a third party advertiser. its just like a celebrity endosing a particuler product, they don't need a license or expertise in that particular field.
Just don't pass yourself off as an expert.

[oliver1]

Thanks magenta.

Just don't pass yourself off as an expert.

There is a fine line here I think because I do content sites in which I would have an article about choosing car insurance.
Now, although I'm not an expert I could do some research and present an honest appraisal of the marketplace and in doing so it might appear like I was passing myself of as an expert.
I suppose it's like the journalists who write the personal finance pages in the daily newspapers. There must be rules (or at least a set of good practice guidelines) regulating them and it's the same info I'm after.

[Nic Redfern]

Hi Oliver,

We do have a document available that summarises the underlying issues and explains the view that we have taken with regard to any campaigns that we run that are covered by the regulation. I am happy to send that over or talk through some of the underlying issues if that would be helpful.

There are also a few areas on the FSA website which you should read through. I am currently out of the office but will arrange for these to be posted later today.

To give a bit of background, the sale of General Insurance Products (with a few minor exceptions) is governed by the Financial Services and Markets Act. This only happened a couple of years ago and at the same time the legislation was extended to cover first charge mortgages. The sale of non-first charge mortgages (essentially most secured loan products) and other credit products is goverened by the Consumer Credit Act. In previous posts over the years there has been some confusion between the two. This is largely caused by the fact that The Financial Services and Markets Act incorporates an almost exact replica of the Consumer Credit Act within it.

The Consumer Credit Act (and related part of the Financial Services and Markets Act) is relatively straight forward to comply with as it is extremely prescriptive, including stating the relative font sizes of particular APRs etc.

The Financial Services and Markets Act is less clear cut. The underlying principle is that if your are advising you need to be authorised and therefore if you are not authorised you should not provide advice. However, having spoken to a large number of compliance people over the last few years there are an extremely wide range of views on what this actually means. The law is very openly worded and does not specifically deal with Affiliate Marketing separately from other types of marketing.

Unfortunately, this means that you will not be able to get an explicit list of does and dont's only a set of opinions. You will need to draw some of your own conclusions.

A couple of key points to bear in mind:

- You are being paid for each sale generated. You are therefore incentivised to encourage people to buy a product. This is very different to being a journalist and exemptions available to them would not apply to you.
- Depending on your site you are probably positioning yourself as an expert, for example, if you say "We'll help you find the best Car Insurance". You may know that you are not an expert but a consumer does not.
- As DrivetoWin says, star systems etc are probably the same as making an explicit written recomendation.

That said there is a lot of activity that you can do without giving advice. On most of our programmes we provide content that has been signed off by the merchant as compliant and you are required to use this to ensure that product specific content is within the regulation.

Hopefully the above is useful but if you have any questions then please feel free to give me call, although I will not be in the office until tomorrow.

Nic

[oliver1]

Hi Nic

Thank you very much for your detailed post. That is very helpful information.

We do have a document available that summarises the underlying issues and explains the view that we have taken with regard to any campaigns that we run that are covered by the regulation. I am happy to send that over

Please do...I will email or PM you with my details shortly.

You are being paid for each sale generated. You are therefore incentivised to encourage people to buy a product. This is very different to being a journalist and exemptions available to them would not apply to you.

I take your point here, although I guess it depends on how the site presents the content in relation to the affiliate ads/links. If the aff links are embedded in the editorial then that is clearly not good journalistic practise, but if the ads are clearly marked as ads (e.g. as banners) then I think it's probably the same as in a newspaper albeit on a different medium.

Anyway thanks a lot for your help and I'll be in touch re the other documents.
Oliver

[Rich79]

There is a really useful page on the OFT site with PDF files available to download with FAQs, examples of compliant/non-compliant adverts, and general guidance for credit advertising:-

The Office of Fair Trading: Credit advertising guidance

The PDFs are actually very easy to follow and seem to have been written with advertisers being the target audience for them.

Enjoy!

[HoTMeLter]

What about simply writing a review on say AA car insurance but not having an afilliate link to an AA program but your own quote engine?

Or

How about simply just having a review with no link at all?