As we approach the end of the month it’s probably worth a quick call-out to remind everyone that new Financial Conduct Authority (FCA) regulations are coming into force from April 1st regarding transparency of information on renewals documents.
What the Changes Mean
As a reminder, the changes centre around insurers and brokers having to disclose additional information on all renewal notices on general insurance policies to their clients. It’s a move that’s been brought about on the notion of providing greater transparency from suppliers, so that customers can ‘shop around’, make fully informed choices, and find the most suitable deal.
Now, it’s been a source of some controversy within the industry, we get that. In fact, we’ve already made our feelings known about the new regulatory changes.
Nevertheless, whatever your own personal thoughts on the matter, these changes are happening, and compliance will be required from all.
The changes required are:
- All companies must disclose, upon all renewal notices, the previous year’s premium. In instances where MTAs have arisen, you need to disclose an annualised premium for that previous 12 month period (minus any associated fees)
- Each notice must contain a new statement that will remind customers to ensure that any cover is completely suitable to their needs, and, that they should (if they desire) to make comparison with other products and providers, on prices and cover
- As well as the above notification, a statement should also be made on notices to customers who’ve been with the same provider for four years or more, to inform them that they might be able to switch money if they switch provider
For a full run-down of the changes in their entirety, have a look at the FCA statement.
Quite simply, if you’re an insurer or broker, and it’s your responsibility for sending out the renewal notifications, then these changes to documentation are going to need to be ready to go from April 1st.
Yes we totally get, and totally empathise with those in the industry (basically, everyone) who have had to make yet more administrative changes; more amendments to documents and customer communication, in order to stay on the right side of compliance.
Changes that can be time-consuming, potentially labour-intensive, and with added costs.
The reality, of course, is that type of thing is something of an occupational hazard, when it comes to regulation and compliance. Changes to notices and what is and is not disclosed within documentation is something always likely to require amendments, always something upon which a company needs to be on top of.
It’s one of the more ponderous (yet interminably necessary) areas of the industry that we at SchemeServe have always been keen to address, tackle, and, as effectively as possible, find a solution for.
It’s one of the features of our Insurance Software provision – he says, shamelessly plugging. The support allowance feature as a client gives you access to seamless, relatively hassle-free, and super-fast amendments to your documentation requirements; be it for this round of FCA changes, or any administrative and reporting changes that will undoubtedly occur in your business in the future.
These changes may not always be popular or welcomed, but they are almost always mandatory and necessary. Ensuring you have a system, service, and process that enables you to make these changes as easily, productively, and quickly as possible, should be a key requirement to the efficiency of your business, and your ability to stay within the boundaries of compliance.