The Financial Conduct Authority (FCA) has published its Business Plan 2017/18. The Business Plan sets out the FCA’s priority work for the year ahead.
The following are the cross-sector priorities for the FCA in the coming year:
- Firm culture and governance
- Financial crime and anti-money laundering
- Promoting competition and innovation
- Technological change and resilience
- Treatment of existing customers
- Consumer vulnerability and access
The Business Plan also identifies certain sector specific priorities. For general insurance and protection the FCA has announced that it will shift its focus away from consumers and SME markets and towards market structures, incentives and distribution.
The FCA plans to conduct a market study on the wholesale insurance market and will consider how effectively competition is working for customers. Under this study the FCA will review whether current market practices are giving rise to integrity and conduct risks. The Business Plan also identifies concerns about how the length of the distribution chain may erode the value of products and services.
The FCA believes that firms’ complex and legacy IT systems are increasing operational risks in the sector and increased outsourcing arrangements are likely to cause challenges in terms of maintaining a consistent level of service to customers. The FCA is also planning to look at how the use of Big Data is affecting pricing practices in a limited number of retail general insurance firms.