ICS London Market has the expertise and experience of working on Conduct Risk issues for Lloyd’s Managing Agents, MGAs and other insurers. This includes reviewing UK insurance policy wordings and related customer documentation for which the insurer (or applicable product manufacturer) is responsible, to ensure those documents are compliant. We can review existing policies and assist with the design and drafting of policy wordings for new insurance products and, in addition, review product governance and value as required by the FCA.
We have successfully drafted numerous consumer and micro-enterprise insurance policy wordings, and accompanying IPIDs, which are currently used in the UK insurance market including commodity and flexible benefit products. We are currently working with a number of firms to ensure their product governance oversight meets FCA requirements and products designed and distributed can demonstrate appropriate value to the target customer.
Some considerations for the legal contract between the insurer and the policyholder and other customer documentation:-
- legally compliant
- clear, fair and not misleading
- plain English
- any delegated authority is clearly shown
- document structure
- regularly reviewed, including robust root cause analysis to identify systemic issues
Micro-enterprise customers (Lloyd’s)
- Lloyd’s and the Financial Ombudsman Service require ‘micro-enterprises’ to be treated as Consumers
- the Insurance Act 2015 requires that a ‘consumer insurance contract’ has the meaning as defined in the Consumer Insurance (Disclosure and Representation) Act 2012; i.e. the Act classifies ‘micro-enterprises’ as Commercial customers
Therefore, Lloyd’s insurance policies for micro-enterprise customers have to be blended to fulfil their Consumer status and comply with the Insurance Act 2015.