The FSA has published issue 8 of its Financial Advisers newsletter. The newsletter looks at:
- Treating customers fairly (TCF). This section looks at the FSA’s progress on implementing the TCF initiative. In particular a recent TCF survey found three specific problem areas which were: (i) Insufficient monitoring of advice to ensure it is suitable and meets the needs of customers. (ii) Inadequate complaints handling procedures. (iii) Lack of processes to gather information and statistics on advice given, products sold and complaints.
- Compliance consultants. This section looks at how small firms should use compliance consultants.Retail distribution review conference. This conference is taking place on 27 June 2007.
- More principles-based regulation. This section looks at the FSA’s move to more principles-based regulation. To help small retail firms understand what this means for them, and what they need to do, the FSA has launched a new site on its small firms web pages.
- Definition of pure protection contracts. This section looks at the FSA’s amendments to its definition of pure protection contracts by removing the age and term conditions. Firms who sell or provide the following will now automatically do so under the Insurance Conduct of Business (ICOB) rules: (i) Long term insurance policies. (ii) Whole of life policies which do not have a surrender value. (iii) Funeral expense plans. However, firms can continue to sell these products under the conduct of business (COB) rules if they wish. To do this, firms must elect to sell pure protection contracts under the COB rules, make a record of this decision and keep it indefinitely. The FSA expects this decision to be taken at a strategic level and not on a client-by-client basis.
- Contracting out of SERPS/S2P. This section looks at the FSA’s investigation into the sales of policies used to contract out of the State Second Pension. In its investigation the FSA found no evidence of widespread mis-selling.
- E-learning, roadshows and upcoming workshops.
View Financial Advisers newsletter - issue 8, (PDF 59KB), 31 May 2007