Were you 1 of the 2 in 5?
Now that’s a mouthful isn’t it. As per Insurance Age, two in five brokers were unaware of how the Financial Conduct Authority’s (FCA’s) crackdown on “fair value”, would affect their business when the new governance rules came into force on the 1st of October 2021. The FCA’s ongoing work to ensure consumers receive fair value looked at how firms designed, sold, and reviewed their products to ensure they met the needs of their customers.
The introduction of uncertainty
The FCA’s new product governance rules affected pretty much all insurance products, and both insurers and brokers needed to change the way they did business. This was a major regulatory change, and many brokers didn’t quite understand the new rules, even with the implementation date fast approaching. The rules were laid out in a way in which businesses needed to interpret them to distinguish how they’d affect their businesses specifically. This meant that a series of parties, such as manufacturers and providers, needed to work together to be aware of their target markets and product characteristics, which is not always easily done. Many were only realising this, as time was running out.
Risking regulatory action
According to the FCA, the review to enforce these rules found weaknesses including: “Insufficient focus on customers, outcomes and product value, including when considering value in the context of Covid-19”, and “Shortcomings in governance and oversight of products”. Insurers have until the 30th of September 2022, to complete their first annual ‘Fair Value’ assessments. Providers which fail to do this work over the next year “risk regulatory action”, according to the FCA.
How REG can help
These new rules fell under the radar for some brokers, and that is where REG could have helped. We are a proven first line of defence to mitigate commercial, credit, regulatory (conduct) and reputational risk around all your B2B partners. Our simple to use platform:
- Keeps you up to date with all FCA mandated checks on any of your business connections
- Allows you to monitor compliance and regulatory obligations
We will keep you one step ahead, always. So instead of finding yourselves in the dark, let REG Technologies assist and keep you in the light faster, smarter, and safer.