As a firm, if you do not have permission to hold Client Money, you must check all your TOBAs to ensure that the firms you are placing business with are granting risk transfer.
With Risk Transfer Money the insurer is basically saying, they trust the firm and once the insurance premiums have been paid to the firm they will treat the money as being paid to the insurer. Therefore, if the firm fails before it pays the money to the insurer the risk of losing the premium has been ‘transferred’ to the insurer and . . .
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