Association of British InsurersFinancial Conduct Authority?regulatory

#FCA warns insurance managers to tackle misconduct ( Motorclaimguru keeps warning Motor insurers of the Statutory obligations under FSMA2000)

By 9th January 2020 No Comments

Not addressing non-financial misconduct may lead managers to fail the SM&CR. The Financial Conduct Authority (FCA) has warned managers at insurance firms that they may fail to pass the Senior Managers and Certification Regime (SM&CR) if they do not address non-financial misconduct. The requirements were set out in a ‘Dear CEO’ letter published by the regulator yesterday (6 January). Jonathan Davidson, executive director of supervision, retail and authorisations at the FCA, said the letter followed “recent, publicised incidents of non-financial misconduct in the wholesale general insurance sector”.

Requirements The regulator expects insurance managers to be pro-active in tackling non-financial misconduct and “poor culture” at their firms. “Poor culture in financial services can lead directly to harm to consumers, market participants, employees and markets,” Davidson wrote. “We view both lack of diversity and inclusion, and non-financial misconduct as obstacles to creating an environment in which it is safe to speak up, the best talent is retained, the best business choices are made, and the best risk decisions are taken.” The FCA outlined four “key drivers of culture” that can help managers influence their firms: leadership; purpose; approach to rewarding and managing people; and governance, systems and controls. Davidson stated that failure to address non-financial misconduct could lead to managers failing to pass the “fit and proper” conduct requirements of the SM&CR.

The regulator expects insurance managers to be pro-active in tackling non-financial misconduct and “poor culture” at their firms.

“Poor culture in financial services can lead directly to harm to consumers, market participants, employees and markets,” Davidson wrote.

“We view both lack of diversity and inclusion, and non-financial misconduct as obstacles to creating an environment in which it is safe to speak up, the best talent is retained, the best business choices are made, and the best risk decisions are taken.”

The FCA outlined four “key drivers of culture” that can help managers influence their firms: leadership; purpose; approach to rewarding and managing people; and governance, systems and controls. Davidson stated that failure to address non-financial misconduct could lead to managers failing to pass the “fit and proper” conduct requirements of the SM&CR. Regulation The SM&CR was introduced for insurers in December 2018 and was extended to insurance intermediaries last month.

 

This article is care of https://www.insuranceage.co.uk/ this article can be found here.

Tim Kelly

Tim Kelly

Tim is a highly qualified Independent Engineer with over 20 years experience as an Engineering Assessor of damaged vehicles.