Insurers and brokers have made strides in improving governance and oversight around product design, management, review, and distribution, but many still struggle to demonstrate that they are delivering fair value to customers or ensuring positive outcomes.

In a report released today, the FCA highlighted ongoing concerns regarding information sharing between insurers and brokers, as well as challenges in clearly identifying target markets.

Matt Brewis, Director of Insurance at the FCA, commented:

“Insurers must ensure their customers receive fair value. While progress is being made, we continue to see numerous cases where insurers and brokers lack the necessary information, governance, or oversight to consistently deliver good outcomes for their customers.

“All insurance firms should heed our findings and make necessary improvements where required.

“We will continue to intervene in cases where we identify poor value, ensuring consumers can trust the insurance products they purchase.”

Earlier this year, the FCA paused the sale of guaranteed asset protection (GAP) insurance by several firms due to concerns over the products’ value. However, in May, the FCA allowed several GAP insurers to resume sales after implementing changes to their offerings.

The regulator has also published its latest Value Measures Data (January – December 2023) and has warned insurers that failure to demonstrate compliance with FCA rules and the provision of fair value may lead to regulatory action.