The IDD comes into force in the UK on 23 February 2018 and concerns the distribution of insurance and reinsurance, as well as covers assisting in the administration and performance of an insurance contract after the sale.
According to the regulator the IDD aims to enhance consumer protection when buying insurance and to support competition between insurance distributors by “creating a level playing field”.
The proposals discussed in the consultation include:
- Changes to rules to implement the product oversight and governance provisions in the IDD, relating to systems and controls firms must have in place for the design, approval, marketing and management of products
- Organisational requirements to protect customers’ money
- Professional requirements regarding good repute of employees of insurance distributors
The FCA also stated that it was consulting on additional changes to ICOBS to those already discussed in the first consultation paper.
These changes include:
- Product information disclosure requirements
- The Insurance Product Information Document
- The use of third-party processors
The regulator is asking for feedback on the proposals, which should be submitted to the watchdog by 20 October 2017.
It further advised that it would be consulting on a few remaining proposals for implementing IDD in a third consultation paper, which it aims to publish in late September.
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