Consumer Duty Guidance

With the July 31st 2023 deadline for firms to meet the FCA’s Consumer Duty requirements having passed, are you in a position to demonstrate how you have met the requirements? No matter what stage you are in the process, Insurance Compliance Services is here to support you with any of your Consumer Duty Guidance needs.

How Can ICS Help You With Consumer Duty Guidance?

ICS can support firms by undertaking an audit or gap analysis of existing processes to establish whether they meet the requirements of the Consumer Duty. We will then deliver a plan outlining the current gaps and what is required to address these. The report will focus on the major outcomes of the Consumer Duty i.e. Product and services, Price and value outcome, Consumer understanding, Consumer support, Monitoring and Conduct Risk.

On receipt of the report Insurance Compliance Services will work with the firm to remedy any gaps and thereafter to ensure that any change in the firm’s business model is reflected within its Consumer Duty responsibilities.

For firms who are not as advanced in their Consumer Duty planning as they should be we can provide an Implementation Plan and work with the firm to create timescales designed to meet the 31st July deadline.

For firms who have made significant progress we can provide an expert view on whether we believe any actions taken by firms’ are fit for purpose.

Your First Consumer Duty Board Report is Due July 31st 2024 - Are You Ready?

The Consumer Duty Board Report is effectively an annual review of how a firm has approached the implementation of the Consumer Duty. From a governance perspective it must be seen, discussed and agreed by a firm’s Board even though it can be prepared by other parts of the business. Production of the Consumer Duty Board Report is an annual requirement with the first one being completed by 31st July 2024.

For further information, check out our detailed page on the Consumer Duty Board Report.
You can even request our FREE Consumer Duty Board Report template!

Make An Enquiry

If you have any questions about Consumer Duty Guidance, or would like to make an enquiry to arrange a chat with one of our Consumer Duty consultants, please complete the form below.

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Consumer Duty Guidance

What is Consumer Duty?

The FCA states that Consumer Duty ‘sets higher and clearer standards of consumer protection across financial services, and requires firms to put their customers’ needs first’.

The FCA’s Consumer Duty is its response to their ongoing concerns about how consumers are treated and moves the dial away from how they are treated (fairly?) to focusing on the experience they have received. With the latter, the FCA’s expectation is that firms will focus on customer outcomes and how best to achieve a positive one. In focusing on outcomes firms will be expected to consider the differing needs of their customers and will have to tailor the customer journey accordingly.

What Are The Risks of Failing to Comply With Consumer Duty?

The Consumer Duty is a cornerstone of the FCA’s three-year strategy and a key element of their work to set and test higher standards. Throughout this timeframe and beyond, the FCA will be establishing firms’ progress in implementing the Consumer Duty by surveys and questionnaires and carrying out targeted engagement with smaller firms. Firms who are unable to demonstrate compliance with the Duty can expect to be on the receiving end of forensic examination of not only their approach to implementing the Duty but across other areas of regulatory compliance within their business.

Consumer Duty Guidance FAQs

Below you will find answers to some of the most common questions we get asked. If there are any further questions you might have please get in touch with one of our Consumer Duty Guidance Consultants on 01892 539600 or email enquiries to us at: enquiries(at)insurancecompliance.co.uk

By the end of April 2023, manufacturers should have completed all reviews necessary to meet the outcome rules and shared necessary information with their distributors. The Duty comes into force 31st July 2023 for new and existing products or services that are open to sale or renewal.

No, the FCA have stated that if general insurance intermediaries completed the work within the 2022 deadlines then they will already be meeting the requirements of the Duty’s products and services, and price and value outcomes.

The FCA would consider that there is now a risk that you may not be ready in time, or that you might struggle to embed the Duty effectively within your business. You should prioritise work to complete the plan so that you can determine what actions you need to take to meet any gaps.

just because a firm does not receive complaints does not in itself mean that all customers are satisfied with how they are treated. The Consumer Duty Customer Understanding outcome requires firms to communicate information in a way which ensures that that is likely to be understood by the whole target market considering vulnerable customers, complexity of products, communication channel etc. This is a good opportunity to review communications which have probably been in place for a number of years to ensure they do meet the needs of all customers in the current challenging financial climate.

Consumer Duty Support from ICS

Now the deadline has passed, do your meet the Consumer Duty requirements? There is a significant amount of work to be undertaken by firms to plan and initiate any changes required to the customer journey, documentation and management information, in addition to existing deadlines for product governance documentation and reporting. Any firm wishing to receive more assistance with the Consumer Duty should contact us as soon as possible.

If you would like information about how Insurance Compliance Services can help by providing you with Consumer Duty Guidance, please call us and talk to one of our Consumer Duty consultants on 01892 539600 or email enquiries to us at: enquiries(at)insurancecompliance.co.uk

Get in Touch

A Few Things to Remember

Don’t forget, there are 4 key outcomes outlined in Consumer Duty Guidance. These outcomes are to be driven by the new rules in PRIN 2A. In summary, they are:

  • Products and Services: all products and services for retail customers to be fit for purpose, designed to meet consumers’ needs, and targeted at those consumers. There is significant crossover between the proposed rules and guidance in this section and the existing Product Oversight and Governance rules.
  • Price and Value: consumers to receive fair value. This outcome is very much in line with the FCA’s insurance pricing ‘fair value’ requirement.
  • Consumer understanding: firms’ communications must support and enable consumers to make informed decisions about financial products and services; consumers must be given the information they need, at the right time, and presented in a way they can understand. Similar requirements are already in place in ICOBS.
  • Customer Support: firms must provide a level of support that meets consumers’ needs throughout their relationship with the firm.

How Can We Help?

We offer up to two initial consultations without charge, to determine the exact nature of your challenges/concerns. If you would like to try out some of our services before committing we can offer a demo of our Compliance Portal, samples of our Hot TopICS or attendance at one of our Webinars. Thereafter we will agree which of our services are most likely to help you most with your regulatory requirements, agree a package of support (or a one-off project) and submit a proposal for review. Before, or after, you decide to go ahead, we will introduce you to the Consultant(s) who will agree a diary of contact at times to suit you both.

Please call us on 01892 539600, email us at enquiries(at)insurancecompliance.co.uk, or send us a message using the form for more information or to make an enquiry about any of our compliance services.

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