Overview:  Protects the officers and staff of financial institutions to ensure they are empowered to defend themselves against FSA disciplinary or enforcement proceedings, any 'prohibition from approval' or 'withdrawal of approval' procedures and even investigations in which no wrongful act has been specified. 
 
Who is it for?:  All financial institutions with personnel subject to the Approved Persons regime.

Specified categories of the officers and staff of institutions regulated by the FSA are required by the Financial Services and Markets Act 2000 to be approved to perform one or more ‘controlled functions’, roles which relate to both the management of the firm and its professional services.

Once a person has been approved by the FSA he or she must remain fit and proper to carry out that function and will be required to observe the standards of conduct set out in the Statement of Principles and Code of Conduct for Approved Persons. If an approved person fails to take reasonable steps to ensure compliance with regulatory requirements, he or she may be held personally liable to FSA fines and public censure.
As a number of individuals have discovered, approved persons can have their approved status withdrawn and may be prohibited by the FSA from performing any controlled function or any function in relation to a regulated activity.

The FSA is increasingly willing and capable of taking all necessary action in pursuit of its statutory objectives including pursuing individuals where appropriate. Defending such proceedings is inevitably time-consuming and expensive. AIG UK has designed its approved persons insurance specifically to protect the officers and staff of financial institutions to ensure they are empowered to defend themselves against FSA disciplinary or enforcement proceedings, any “prohibition from approval” or “withdrawal of approval” procedures and even investigations in which no wrongful act has been specified.