Motivational headlines from the FCA!

At first glance on the FCA’s website the headlines around their three-year strategy don’t sound too promising:

Resources focused on outcomes to prevent serious harm and promote competition.

80 new roles created to shut down problem firms.

GULP!

The next line then offers the comfort that this phase in the life of the FCA could be defining for everyone involved in delivering outstanding customer outcomes: ‘The FCA has launched a new strategy to improve outcomes for consumers…(Consumer Duty)’ Now entering the final year of that strategy we look at what is being planned for 2024-25 and what might this mean for you?

Introduction 

Throughout this 3-year journey the FCA have held onto and built on three core outcomes:

• 1. Reducing and preventing serious harm

• 2. Setting and testing higher standards

• 3. Promoting competition and positive change

The cornerstone of ‘setting and testing higher standards’ has been the introduction of Consumer Duty with the next key milestone being 31st July 2024 when firms need to ensure that both open and closed products are delivering the right outcomes for consumers. From the FCA’s perspective they will continue to focus their interventions where there is greatest risk of harm or where more work is needed by firms to identify and address gaps and to meet the higher standards of the Duty. 

As a Refresh...

Commitment 2 in this year’s business plan is: Putting consumers’ needs first

Here are some of the highlights of what will continue to support this in 2024-25…

• ·        Supervisory work to test firms’ implementation of the Consumer Duty and to improve firms’ delivery of good consumer outcomes. This includes

  • complaints-handling and root cause analysis, consumer support journeys, consumer understanding, fair value and closed products and services. 

• ·        Combine insights on consumers’ needs through our research and partnerships to inform our supervisory and enforcement action. 

• ·        Work with the Government and other partners to support consumer access to products and services and tackle financial exclusion.

Activities that will start in 2024-25…

• ·        Multi-firm work and market studies across different sectors to drive up standards. Our multi-firm work will also look at how swiftly the insurance industry

• responds to claims, including where customers are more likely to show characteristics of vulnerability.

• ·        A review of firms’ treatment of customers in vulnerable circumstances.

All designed to support a range of key outcomes…

• ·       firms act in good faith towards consumers, avoid causing them foreseeable harm and enable and support them to pursue their financial objectives,

• ·       consumers are sold products and services that meet their needs, characteristics, and objectives,

• ·       consumers pay a price for products and services that represents fair value, and poor value products and services are either improved to deliver fair value or

• removed from markets, 

• ·       consumers are equipped with the right information to make effective, timely and properly informed decisions about their products and services,

• ·       consumers receive good customer service,

• ·       consumers have confidence in financial services markets,

• ·       the Consumer Duty encourages firms to innovate, supporting growth and driving effective competition in the interests of consumers,

• ·       appropriate access to financial services is maintained,

• ·       firms support consumers to sustainably manage their debts.

What does this mean to you?

I think put simply the FCA will continue to deliver on its ambition to drive standards within financial services in the UK to new and higher standards and won’t lose sight within the rules, regulations, and guidelines that the consumer is king, comes first, and everything that is undertaken within the industry must put the consumer to the forefront.

There is also a greater sense of co-ordination as the 3-year strategy reaches its end, with plans and actions relating to combined insights, partnerships, market studies, multi firm work etc. all of which suggests that the FCA is reaching out further into its customer base to better understand its challenges and issues. Collaboration is the process of two or more people, entities or organisations working together to complete a task or achieve a goal…much of what you read and see from the FCA gives a better sense of this taking place which can only be good for the industry.

Insurance Support Solutions Ltd can provide business support and guidance to support the successful answering of the question ‘‘Am I in collaboration with the FCA’s direction of travel?” ensuring:

• ·   Raised customer awareness

• ·   Customer trust and confidence

• ·   Adherence to the 4 outcomes and alignment with the expectations of 2024-25

• ·   Staff competence

Ask us about what is involved, and we will work with you to provide a bespoke solution that gives you the confidence and conviction that Consumer Duty is live and making a positive impact within your business and on your customer relations.

And Finally…

What do you call 20 people smoking dope and finding solutions to the world’s biggest problems…’A Joint Collaboration!’