United Kingdom

Topic: Insurance

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Lloyd’s announces timetable for the launch of its new third-party oversight regime

In July 2019 Lloyd’s announced (in Market Bulletin Y5257) proposals to introduce a new oversight framework for third-parties operating in the market.  On 1 July 2020, Lloyd’s announced in a further Market Bulletin (Y5296) that the framework would be brought into effect on 30 September 2020. The new framework aims to ensure that arrangements with … Continue Reading

FCA confirms guidance for insurers and intermediaries on how they should consider the impact of COVID-19 on product value

The FCA has finalised guidance on what it believes insurers and insurance intermediaries should be doing to identify issues relating to COVID-19 that affect the value of insurance products. The guidance is intended to highlight areas where firms might prioritise product reviews in light of the pandemic. The FCA expects firms to consider how the … Continue Reading

Updates from the FCA on its business interruption test case

On 10 June 2020, the FCA announced on its website that it had started proceedings in the High Court to resolve uncertainty over the validity of business interruption insurance claims. The test case in which the FCA is claimant and several insurance companies are defendants is brought pursuant to the Financial Markets Test Case Scheme. … Continue Reading

FCA provides an update on the test case on the validity of business interruption insurance claims

On 1 June 2020, the Financial Conduct Authority (FCA) provided an update on the progress of its test case on the validity of business interruption insurance claims. The update also provides a representative sample of 17 policy wordings that capture the majority of the key issues that are likely to be in dispute. Insurers had … Continue Reading

UK Government to provide trade credit insurance guarantee scheme

John Glen, Economic Secretary to the Treasury, has announced that the UK Government will guarantee business-to-business transactions supported by trade credit insurance. The guarantee will enable trade credit insurers to maintain coverage during the coronavirus (COVID-19) pandemic. The guarantee will be delivered through a temporary reinsurance agreement with insurers currently operating in the market. The … Continue Reading

FCA sets expectations for insurers during COVID-19 outbreak

Through a series of statements released on May 1, 2020, the Financial Conduct Authority (FCA) made clear its expectations of the insurance sector in light of coronavirus (COVID-19). The FCA: Proposes to seek clarity on whether a sample of wordings in business interruption policies do, in fact, provide coverage for COVID-19, via a declaratory judgment in … Continue Reading

FCA publishes Product value and coronavirus: draft guidance for insurance firms

On 1 May 2020, the Financial Conduct Authority (FCA) published guidance setting out their expectations for insurers and insurance intermediaries to consider the value of their products in light of the exceptional circumstances arising out of coronavirus (Covid-19). The guidance applies to all firms carrying on regulated activities relating to all non-investment insurance products, i.e. … Continue Reading

FCA to obtain court declaration to resolve contractual uncertainty in business interruption insurance cover

On 1 May 2020, the Financial Conduct Authority (FCA) released a statement that it intended to obtain a court declaration in order to resolve contractual uncertainty in business interruption insurance cover. The FCA is taking this action to resolve uncertainty surrounding business interruption claims in the context of business closures in the light of coronavirus … Continue Reading

FCA makes statement on its website about professional indemnity insurance for financial advisers

The Financial Conduct Authority (FCA) has published a statement on its website concerning the ability of financial advisers to get professional indemnity insurance (PII). PII is a requirement for a number of authorised persons under FCA rules. The FCA writes that it is aware that insurers providing PII cover may seek additional information during the … Continue Reading

FCA publishes ‘Dear CEO’ letter to insurance firms regarding the conduct of business interruption claims

On 15 April 2020, the Financial Conduct Authority (FCA) published a Dear CEO letter regarding conduct in relation to business interruption insurance for SMEs concerning Covid-19. In the letter the FCA outlines that insurers and brokers have an essential role to play in supporting their customers who may be unclear whether they have appropriate cover … Continue Reading

EIOPA publishes opinion on the supervision of remuneration principles in the insurance sector

The European Insurance and Occupational Pensions Authority (EIOPA) has published an opinion to promote consistent approaches to the supervision of remuneration. While the Solvency II Delegated Regulation provides requirements on remuneration, these are sufficiently high level and allow room for discretion. This opinion provides guidance to EU national supervisory authorities on how to apply the … Continue Reading

The insurance sector and COVID-19 – how has the pandemic affected the UK market?

COVID-19 (coronavirus) has had a devastating impact on people’s lives across the world and has caused the global economy to stall, the impact to affect businesses for years to come. Insurance companies face losses as a result of the pandemic but have by and large been prepared for such an outbreak as part of their … Continue Reading

Financial Ombudsman Service: Coronavirus (Covid-19): information for businesses

The Financial Ombudsman Service (FOS) has published some operational information about their service that might be helpful for businesses, and sets out some detail about their approach to complaints caused or affected by Coronavirus. In relation to travel insurance The FOS will pay particular attention to: individual circumstances, policy terms, when bookings were made and … Continue Reading

PRA publishes ‘Dear CEO’ letter to UK insurers regarding distribution of profits

On 31 March 2020, the Prudential Regulation Authority (PRA) published a Dear CEO letter from Sam Woods, Deputy Governor, to the CEOs of UK insurers regarding distribution of profits. The letter outlines an expectation on insurers to pay close attention to the need to protect policyholders and maintain safety and soundness in order to ensure … Continue Reading

NYDFS Requires COVID-19 Plans by April 9

On March 10, 2020, the New York Department of Financial Services (NYDFS) issued guidance to all of its regulated institutions engaged in virtual currency business activity, requiring them to have plans for preparedness to manage the possible operational and financial risks posed by the COVID-19 pandemic. NYDFS requires the plans to be submitted by Thursday, … Continue Reading

Chair of the House of Commons Treasury Committee writes to Director General of the ABI seeking information on insurance companies’ response to coronavirus

Mel Stride MP, Committee Chair of the House of Commons Treasury Committee, has written a letter to Huw Evans, Director General of the Association of British Insurers (ABI) seeking responses to a series of questions about how insurance companies are responding to the coronavirus.  The letter opens by stating that “many will be looking to … Continue Reading

FCA updates its statement on expectations for insurers and brokers during the pandemic

On 31 March 2020, the Financial Conduct Authority (FCA) updated its statement on what it expects insurers and brokers to do during the covid-19 pandemic. The update concerns the expectations for MOTs, product suspension and renewals. For the previous statement please read our earlier blog. Vehicle MOTs In light of the guidance from the Department … Continue Reading

EIOPA issues recommendations on flexibility for supervisory reporting and public disclosure deadlines

On 23 March 2020, the European Insurance and Occupational Pensions Authority (EIOPA) published recommendations to European National Competent Authorities that aim to offer operational relief and support business continuity to insurance and reinsurance undertakings by extending deadlines for supervisory reporting and public disclosure during the Covid-19 outbreak.  EIOPA states that “undertakings need to concentrate their … Continue Reading

FCA issues statement on its expectations for insurance companies and brokers in respect to Covid-19

On 19 March 2020, the Financial Conduct Authority (FCA) published a statement on what it expects insurers and brokers to do during the pandemic. Firms should consider the needs of their customers and show flexibility in how they are being treated during this time, particularly as policyholders will have to change their behaviour during the … Continue Reading

EIOPA issues a statement on actions to mitigate the impact of Covid-19 on the EU insurance sector

On 17 March 2020, the European Insurance and Occupational Pensions Authority (EIOPA) issued a statement on actions to mitigate the impact of Covid-19 on the insurance sector in the EU. EIOPA states that insurers will face “progressively difficult conditions in the immediate future, both in terms of navigating challenging market conditions and in maintaining operations, … Continue Reading

PRA publishes Policy Statement PS7/20 – Solvency II: Adjusting for the reduction of loss absorbency where own fund instruments are taxed on conversion

On 16 March 2020, the Prudential Regulation Authority (PRA) published  the policy statement Solvency II: Adjusting for the reduction of loss absorbency where own fund instruments are taxed on conversion (PS7/20). PS7/20 provides feedback to responses to a consultation paper with the same title (CP26/19). It also contains the PRA’s final policy in an updated … Continue Reading

PRA writes to insurance firms about outstanding EU liabilities

The Executive Director of Insurance Supervision at the Prudential Regulation Authority (PRA), has written to insurance firms to seek confirmation that they have contacted relevant EU authorities to ensure that Brexit contingency plans remain satisfactory. With the UK leaving the implementation period at the end of the year, the PRA wants firms to ensure that … Continue Reading

FCA publishes policy statement on travel insurance sign-posting for people with pre-existing medical conditions

On 5 February 2020, the Financial Conduct Authority (FCA) published a policy statement on Signposting to travel insurance for consumers with medical conditions (PS20/7). The new FCA Handbook rules will require firms to include details of a directory of firms that will cover people with pre-existing medical conditions within 30 days of the directory going … Continue Reading

FCA publish “Dear Board of Directors” letter to firms in the Personal & Commercial Lines Insurer portfolio regarding identifying and remedying harms

On January 8, 2020 the Financial Conduct Authority (FCA) published a “Dear Board of Directors” letter addressing firms in the Personal & Commercial Lines Insurer (PL&CL) portfolio in order to address identifying and remedying harms. The FCA’s view is that there are significant risks of harm that both market and individual firms need to address … Continue Reading
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