Assisting Client With Feasibility Study on Creating A Start-Up Insurer And Obtaining UK Authorisation
The Client’s Needs
The client is a start-up that intends to provide non-insurance products and financial services to a large number of Micro, Small & SME businesses. They also intend as a part of their product range to support the other products and services with insurance products and intend to own the value chain in all of the products and services that they offer including through an authorised insurance company.
The client asked ICSR to assist it with the process of planning for and obtaining authorisation to transact insurance from the PRA and FCA, including support with preparing all of the necessary documentation.
ICSR worked with the client from a very early stage in their planning, helping to undertake a feasibility study based on their initial business plan. The feasibility study was designed to ensure an application for authorisation could proceed and was in a position to do so as quickly as the regulators would allow it to do so. The feasibility study covered:
- Developing the high-level target operating model;
- Producing an outline Governance and oversight structure;
- Creating an outline Organisational Chart identifying the appropriate levels of resources required; and
- Building an outline financial plan with anticipated costs for operating and maintaining the insurer.
The benefit of this approach was that it mitigated risk for the client in the event it concluded it was not financially viable given the cost of operating an insurer or was not able to meet the expectations of the UK regulators for authorisation, whilst ensuring that any work done was beneficial in the event the application proceeded.
ICSR deployed a blended team, led by a Director and supported by the Risk Director to provide the core advice and supported by a member of the Talent Pool with specific subject matter expertise in the design, build and execution of new target operating models. The work was overseen by a director of the business.
The client was able to refine its business plans in a way that was aligned to the expectations of the UK regulators and its full application for authorisation is now proceeding quickly and efficiently. It expects to have its application approved and be trading ahead of its original planned timeline.