Assisting with Compliance Framework Development for UK Branch
The Client’s Needs
The client is an insurance company based in Europe. It was applying for authorisation in the UK in order to open a branch to underwrite risks in the UK and was required to comply with the regulatory requirements of the UK as set out by the Prudential Regulatory Authority (PRA) and the Financial Conduct Authority (FCA).
Many of the activities of the Branch would be supported and managed from head office but there were aspects of the UK regulatory environment that required local UK advice and support, including creating its Compliance and Risk Frameworks and building the processes and procedures that the branch would adopt. It also required support on an ongoing basis. The client also wanted ongoing access to subject-matter expertise in the UK regulated environment.
ICSR created the Compliance and Risk frameworks required to ensure the client was meeting UK regulatory requirements in a way that was proportionate for its business plan, which focussed on providing binding authority capacity for coverholders/MGAs. The new Consumer Duty rules as well as the requirements for Product Value assessment took effect during the process of seeking authorisation and ICSR was able to adapt the frameworks and controls to include the necessary changes to reflect this, against the backdrop of the client’s business model being totally focussed on consumer lines products.
ICSR deployed a Talent Pool member with risk expertise, supported by a member of the team with a compliance focus, to ensure all the necessary controls and frameworks were developed. Both had experience working with insurers, coverholders and MGAs, helping them contextualise the work for the client. The work was overseen by a director of ICSR.
The client has now received authorisation to operate its UK branch and has all of the appropriate controls and frameworks in place to manage the UK branch as part of its European-based business. It is now providing capacity to UK based coverholders and MGAs underwriting consumer lines business. ICSR is providing ongoing support to the client through a retainer model, with Compliance and Risk experts continuing to form part of the client’s virtual team, working with its European-based Head Office functions.