Dealers will be prevented from selling insurance products unless they sign up to the General Insurance Standards Council by September 1.

Chris Wood, training and development manager of Direct Group, which is advising dealers, said: “Dealers will need to sign up to and comply with the GISC customer code if they are to continue selling payment protection, Gap, replacement and mechanical breakdown insurance.

“The requirements also apply to carmakers, finance companies and insurers.”

GISC membership fees range from £200 to £100,000 a year.