ABI updates unit-linked funds guide: ABI has updated its Guide to Good Practice for Unit-Linked Funds to incorporate the findings of FCA's thematic review into the governance of unit-linked funds. The Guide covers funds':

  • governance;
  • launches, mergers and closures;
  • operations;
  • valuations and unit pricing;
  • breaches, errors and material incidents; and
  • emergency situations. 

In the absence of detailed rules for unit-linked fund managers, ABI believes these firms should follow the guidelines laid down in the Guide and act in accordance with FCA's Principles for Businesses and the Treating Customers Fairly (TCF) requirements. FCA has also said that it will take the Guide into account when supervising unit-linked fund managers. ABI expects firms to review their operations and start making any changes required by the end of the year. Managers of closed funds may strike a balance between the improved standards and the cost for a fund which is in run off. Where a firm applies an approach that differs from the Guide, it should be able to explain why it is doing so and to show why that approach is at least as effective in securing Treating Customers Fairly outcomes. (Source: ABI Guide to Good Practice for Unit-Linked Funds)