Autumn leaves: papers on insurance governance

A flurry of recent documents from the Financial Conduct Authority have targeted the insurance industry’s product governance with a series of reporting and value measures. Adam Samuel rakes through the implications for firms.

Adam SamuelBA LLM DipPFS MCISI FCIArb Certs CII (MP&ER) Barrister and Attorney may be contacted atadamsamuel@aol.com.For links to where you can buy the second edition of ‘Consumer Financial Services Complaints and Compensation’, see www.adamsamuel.com/book.

This autumn, the FCA announced a dramatic tightening of the way in which the United Kingdom’s general insurance market is governed. In two connected moves, the regulator announced the final rules for reporting value measures for almost all general insurance to the FCA in PS20/9. At the same time, there appeared MS18/1.3, a market study of pricing practices that painted an ugly picture of how insurers in the motor and home sectors are exploiting loyal and vulnerable customers. This appeared alongside CP20/19, a string of measures designed to improve insurance product governance, prevent some of the pricing practices found in the market study and make it easier for customers to stop auto-renewal. All of this came just after the fourth value measures pilot report, which painted a bleak picture of personal accident and key cover add-on policies. The proposed entry into force dates for the various measures differ but the message is reasonably clear. The general insurance party is over.