Insurance Sales Regulations (1997)

Overview of UK Insurance Sales regulations in 1997, presented to Canadian Institute of Actuaries as comparison against US and Canadian Regulations

Transcript

1. Insurance Sales Regulations UK 1997
2. UK Regulatory Structure PIA IMRO SFA Direct regulation Recognised professional bodies S I B
3. Sales Process • Financial Services Act 1986 – Best Advice – Know your customer
4. Prospecting • Cold calling • Purpose of call must be disclosed up front
5. Appointment • Disclose status • ‘Factfind’ – Normally several pages long – Designed to obtain all information relevant to recommend a financial product.
6. Product Presentation • All marketing materials must be prepared according to the regulations – accurate and honest, – relevant and current, – not likely to mislead, – source quoted for all statistics, – contain appropriate warnings
7. Life Assurance Regime • Key Features Document • Illustrations • Commission disclosure
8. • Key Features Document • Illustrations – Not an estimate of future benefits – Two rates of interest quoted – Own expenses • Commission disclosure – direct remuneration – cost of services and benefits received
9. Underwriting • Revised illustration?
10. Issue / Delivery  Contract terms, another set of Key Features and a Cancellation Notice sent out (or delivered). • Cooling off period – 14 days to change mind.
11. On-going administration • Further advice • In force illustrations • Changes to policies
12. Other Protection  Published information  Direct advertising – category A, B or C  Product bias  Office of Fair Trading, Data Protection Act  Complaints.
13. Responsibilities • Board / Chief Officer • Compliance Officer • Actuary
14. Current Issues • Pension Review • Super SIB • Non-Life disclosure
15. Summary Prospecting The customer knows immediately intention to sell insurance Appointment / Responsibility on the agent to knowyour customer to interview provide best advice. Disclosure requirements • Product illustration on 2 prescribed interest rate, own expenses. • Simple clear Key Feature Document. • Commission disclosure Underwriting Revised illustrations Issue / Delivery Can change mind for 14 days. Agent cannot visit during this period On-going In force illustrations prepared according to similar admin regulations as new business.