FCA scrutinises vertically integrated insurance conflicts of interest

FCA published information for insurance firms on managing conflicts of interest in vertically integrated business models.

The FCA is focusing on vertically integrated insurance models where product manufacturing, distribution and claims sit within group structures. Firms should evidence robust conflicts management, fair value assessments and customer outcome testing across the distribution chain.

Heightened supervisory attention on insurance value chains, distribution conflicts and product governance.

Vertically integrated models are a recurring FCA concern with implications for product governance and fair value.

“The FCA's new insurance director notes publication of information for firms on vertically integrated business models, alongside work on claims experiences, rule simplification and captive insurers.”