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March 10, 2026
The FCA has published the first of its new annual Regulatory Priorities reports, replacing the familiar Portfolio Letters. Insurance gets to go first. At first glance, it looks very different: it is visually clearer, more accessible, and runs to 17 pages. In many ways, it sits somewhere between the old Portfolio Letters and the even older ‘Sector Views’ that were discontinued during the Covid pandemic.
Importantly, the tone has shifted. This feels less like “this is what you have to do” and more like “this is what we are seeing, and what we expect of firms”. It also shouts about the work the regulator has already done more so than previous publications. Overall, it is a collaborative and user-friendly publication, and in line with the FCA’s stated ambition of becoming a “smarter regulator.”
One particularly helpful addition is the inclusion of a clear timeline, towards the end of the document, which will save firms time interpreting expectations from dense narrative text.
Subtle but important signals
The foreword explains that the report can be used by Boards and CEOs. If the FCA was to pop up unexpectedly, it would expect this to have been scrutinised by senior management. It would therefore be remiss of a firm not to have discussed this as an agenda item at the Board and/or Executive level meetings.
In an ideal world firms would be mapping out their current performance against each area of focus, and recording any actions that have decided to be taken off the back of these meetings.
The FCA also seems to be actively encouraging feedback on these reports, which firms may wish to consider.
The FCA’s insurance priorities
The FCA sets out four priorities for the insurance market this year. None of these will come as a surprise, and most have been widely discussed in the lead-up to publication:
- Improving consumer understanding, claims handling and service quality
- Increasing access to insurance
- Supporting growth and innovation
- Simplifying regulation
The first priority is key for all firms and highlights where the FCA insurance department’s focus will be, when assessing firms implementation of the Consumer Duty. This clarity is likely to be welcomed by the market.
Two priorities have a slightly different approach
For the latter two priorities: Supporting growth and innovation and Simplifying regulation, the diagram in the report links these to the FCA-wide objectives of supporting economic growth and being a smarter regulator. Notably, the grey boxes in these sections do not set out firm expectations, but instead outline “what we encourage firms to do”. This signals a more facilitative approach.
Although this approach and tone differs here to the first two priorities, there are still expectations of firms to carry out any innovation sensibly. If the FCA become aware of a firm using ‘innovation’ as a reason for poor customer outcomes, it will not be acceptable . It will still expect appropriate governance, oversight and controls in place for any such projects.
The tone is very different for the first two priorities: Improving consumer understanding, claims handling and service quality, and Increasing access to insurance.
Where supervisory scrutiny is most likely
Firms should pay particular attention to the grey box at the top of page 8, which relates to the FCA’s expectations for improving consumer understanding, claims handling and service quality.
A sensible first step is to:
- Discuss this section at senior management or Board level
- Ensure these practices are genuinely happening in the business
- Confirm they are being evidenced and appropriately recorded and reported
- Identify and record actions where the firm may be falling short
This is the area where supervisory intervention is most likely, particularly where the FCA identifies actual or potential customer harm.
For example, if the FCA sees high complaint volumes that indicate poor customer understanding or weaknesses in claims handling, firms could expect contact from the regulator, whether by email, phone call or visit.
To be on the front foot, firms should:
- Closely monitor complaint and claim data
- Undertake meaningful root cause analysis
- Implement and document actions to address underlying issues
If the FCA does make contact and this work is already underway, firms will be in a significantly stronger position.
Increasing access to insurance and vulnerable customers
The priority of increasing access to insurance is likely to drive increased focus on vulnerable customers. This is a financial services-wide area of regulatory attention, with a significant amount of guidance already published, including by the CII.
Firms should ensure they have a considered and practical approach to vulnerability. This should not be treated as a tick-box exercise. Vulnerability is subjective and can change over time, meaning it needs to be regularly discussed, reviewed and embedded into day-to-day practices.
Other areas of focus: financial crime
The report also includes a section on “Other Areas of Focus”, which contains points to the focus on financial crime. As expected, the FCA is undertaking work in this area, seemingly a review of financial crime systems and controls across a sample of larger firms. The regulator plans to share the findings with the wider industry in 2026, which should help smaller firms benchmark their own arrangements. Based on previous thematic work, this is an area where the FCA is likely to take a tough stance where it sees weak or complacent approaches.
What should brokers do now?
In practical terms, brokers should:
- Read the report in full
- Discuss it at Board or senior management meetings
- Identify areas for improvement and record actions
- Be on the front foot in case they receive supervisory scrutiny in relation to consumer understanding, claims handling and service quality
- View the remaining priorities as opportunities to engage proactively with the FCA
One final point
A consistent theme throughout the report is the importance of effective oversight, controls and governance. Firms should ensure any outsourcing arrangements are appropriately overseen and documented, with regular reviews and clear accountability on both sides. Key discussions, particularly where decisions are made, should be properly recorded, alongside evidence of improvements to systems and controls. The FCA will often ask firms to demonstrate where enhancements have been made, so documenting progress and being able to evidence positive change is, quite simply, a no-brainer.
Overall, this publication represents a more structured approach from the FCA to communicate its regulatory priorities. For firms that take it seriously and act early, it presents a genuine opportunity to strengthen governance and improve regulatory engagement.
