The Financial Conduct Authority has sanctioned four firms to recommence their sales of guaranteed asset protection insurance after the regulator had stepped in to demand operators in the market improved the fair value they offered.

To restart sales, the FCA said firms needed to demonstrate that their GAP products represented fair value to consumers. It said data from 2022 showed that some firms had been paying out 70% of premium income in commission and only 6% of premium income as claims.

To restart selling, firms need to demonstrate they can offer fair value. The fours firms that have done this are: Fortegra Europe Insurance Company Ltd, Motors Insurance Company Ltd, Amtrust Europe Ltd and Financial & Legal Insurance Company Limited.

Sheldon Mills, executive director of consumers and competition at the FCA, said: “We took action when our data showed that customers were not getting a fair deal.

“I’m pleased that, following constructive engagement with industry, a significant proportion of the market is now able to restart sales.

“GAP insurance can provide a useful service to customers and we continue to work with the rest of the market to address our concerns.”