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News & Events

20th February 2012

FSA operating 'twin peaks' regulatory model from April 2012

In a speech to the British Bankers Association, Hector Sants, chief executive of the FSA, gave an update on the progress of the regulatory reform programme, which will lead to the replacement of the FSA by the FCA and the PRA. He announced a major milestone in the regulatory reform programme, namely the introduction of a "twin peaks" model operating within the FSA from 2 April 2012. This will mean that from this date the FSA’s operations will be split into two in order to simulate and gain experience, of, working as two separate organisations.

The new operating model will mean that banks, building societies, insurers and major investment firms will, from 2 April 2012, have two groups of supervisors, one focusing on prudential and one focusing on conduct. All other firms (i.e. those not ‘dual regulated’) will be solely supervised by the conduct supervisors. For the full text of this speech click here.

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12th July 2011

FCA Approach to Regulation

The FSA has published a document which sets out how the Financial Conduct Authority (FCA) will approach the delivery of its objectives. The new body will be responsible for regulating general insurance intermediaries from the end of 2012. Promising a successor that will be “tougher, stronger and more engaged with consumers”, the FSA is seeking comments and feedback by 1 September 2011.

To read the FCA Approach Document click here.

New Rules on Website Cookies

Cookies are a device used by many websites to store and retrieve information from the personal computers of visitors to their sites. The EU's Privacy and Electronic Communications Directive, which came into force on 26 May 2011, requires all businesses, including insurance intermediaries, to obtain consent to the use of cookies from web site visitors.

The UK's Information Commissioner's Office (ICO) is allowing firms that run websites aimed at UK consumers one year to comply before enforcing the new rules. To assist with this, the ICO has published guidance on the steps that organisations will need to take as well as more specific enforcement guidance.

CMS recommends that the ICO's guidance is reviewed by intermediaries that operate websites which are in any way interactive, as they will probably be using cookies.

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11th February 2011

Commercial customer disclosures

CMS has learned that the FSA has commissioned FDS International, an independent market research agency, to undertake a wide-ranging study of commercial insurance customers’ understanding of the service they receive from their brokers. Questions being asked of policyholders include the extent to which they are alerted to their right to ask for commission information, the clarity of the information provided about the capacity in which their broker is acting, the breadth of the product search undertaken and whether another intermediary is involved in the placement.

The research is designed to test the effectiveness of changes made to brokers’ practices following previous FSA concerns. This led to the introduction of Industry Guidance in April 2009 for brokers selling commercial insurance.

It is anticipated that the FSA will report its findings and proposed actions to the market later in 2011.