Insurers face up to £20m platform upgrade cost as FSA plans to ban fees

At present, providers of investment products generally pay to have their products included on an insurer's platform, and often this cost is then passed on to the investor in the price of the product.

The FSA hopes that by introducing a ban on such fees it will make charges clearer to investors, who often think that use of the platform is free, and also increase competition in the market.

A ban would allow investors and advisers to compare the costs of investing through different platforms and make an informed decision on whether using a platform represents good value for money, the FSA said this week.

"Investors are increasingly using platforms as a convenient 'one-stop-shop' for their investments, but at the moment many investors have no idea what they are paying for this service," said Sheila Nicoll, director of conduct policy at the FSA.

"This needs to change. We are proposing changes that give investors and their advisers more control and mean that they know exactly what they are paying for a platform's service."