Kenneth Underhill hosted a webinar in conjunction with the Managing General Agents Association on 22nd September, looking at the implications of the FCA’s latest guidance to distributors of products. A recording of this webinar is now available to watch using the link below.

Background

On 29^th July 2022, the FCA issued strongly worded guidance to manufacturers and distributors of products, following on from new rules on General Insurance Pricing Practices published in May 2021. A follow up survey of members in 2022 identified serious concerns about the way firms were implementing the necessary changes to comply  with rules and guidance in relation to product governance and oversight under PROD 4.2 and putting in place the necessary product approval processes to identify whether their products provide fair value to consumers. A transitional period for implementing the necessary changes ends on 30^th September and the FCA is “… disappointed with the progress made by many manufacturers which falls short of our expectations on timely implementation.”

Manufacturers have been given very strict instructions on what is now expected of them and the MGAA have already looked at this in a briefing on 1^st September aimed specifically at product manufacturers.

In this subsequent briefing, Kenneth Underhill looked at the impact of the delays in that work for distributors against their own obligations and the potential impact on customers. Kenneth also provides a summary of the original obligations as a reminder to distributors of their responsibility under the Product Governance rules and sets out the strict criteria under which the FCA will provide a forbearance that allows them to continue distributing products to prevent significant harm being caused to customers through the withdrawal of products from distribution.

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