The Financial Conduct Authority (FCA) has undertaken an in-depth review of the life insurance market’s governance arrangements and pure protection product fair value.
The regulator said it had conducted the review over 2023/2024 to examine firms’ product governance arrangements, including delivering fair value.
It has shared the initial findings with insurers and providers but said it will only be publishing its final report “in the coming months”.
Writing to life insurance CEOs as part of preparations for extending its Consumer Duty to closed book products, FCA executive director of consumers and competition Sheldon Mills said: “We have undertaken a thematic review over 2023/2024 to examine firms’ product governance arrangements, including delivering fair value that covered pure protection products.
“We have shared this review’s initial observations with all manufacturers and will publish the final report in the coming months.
“The findings set out in the final report may be relevant to the consideration of the value of products under the Consumer Duty,” Mills added.
“The review’s findings may help firms when looking at their closed-product books covered by the duty.
“The prompts build on our previous communications and supervisory engagement with your firm. They are not a complete list, and we expect your firm to consider anything else that may be relevant.”
Health & Protection understands the review sampled a range of manufacturers and distributors across various general insurance and pure protection products and was not specific to only the life insurance and pure protection sector.