FCA Updates its Q&As Document on General Insurance Pricing Practices Rules

The FCA has added a new question to its Q&As document on the General Insurance Pricing Practices published rules.

Updated on 20 December, the addition made to the document is in relation to charity:

1.24 How do the rules on incentives apply to firms that make or fund a donation to charity for each policy bought?

The table in ICOBS 6B.2.14R states that carbon off-setting would not be considered a cash equivalent incentive. A charitable donation has a similar effect of providing a broader social benefit and not an economic benefit to the customer. Therefore, if it does not alter the price paid by the customer, it would not be caught by our rules on incentives and will not need to be reflected in the equivalent new business price when the renewal is offered.

The rules on pricing, auto-renewals and reporting come into force on the 1 January 2022. Firms have a transition period until 17 January 2022 to fully implement the pricing and auto-renewal disclosure remedies, but, after 1 January 2022, they must pay redress or make repayments to people if the delay to implementing negatively impacts them. 

If you have any questions regarding the above or any other compliance issues, please contact your Business Manager or the team at RWA via 01604 709509 or helpdesk@rwagroup.co.uk.

 

About the author

Kirk joined RWA in 2015, having worked in the financial services sector for many years. He started out in both the general insurance and mortgage advice arms of HSBC, before becoming the Compliance Officer at Go Compare and Training & Competence Manager at Optimum Credit. 

At RWA, Kirk is Deputy Head of Compliance. He supports RWA clients by looking after their compliance, training and competence needs and keeping them up to date with regulatory changes. He promotes the achievement of fair customer outcomes and specialises in designing and implementing T&C schemes for firms of all sizes.

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