Financial Conduct Authority confirms simplified insurance rules and proposes technical Handbook streamlining after the Consumer Duty

The Financial Conduct Authority has issued final changes to simplify its insurance rules, aiming to reduce compliance costs for insurers and brokers while maintaining appropriate protections for smaller commercial customers. It also published a separate set of proposals to streamline the FCA Handbook and reduce complexity following the introduction of the Consumer Duty. The final rules give insurance firms more flexibility and responsibility in how they meet regulatory expectations, including allowing firms to decide the frequency of product reviews and the amount of continual professional development their staff should undertake. The Handbook proposals include removing three further insurance data returns, reviewing eligibility and disclosure rules for packaged bank accounts, streamlining rules on collective investment and updating rules on client assets, and removing Handbook references considered unnecessary now the Consumer Duty is in force. The FCA plans additional changes to cut unnecessary insurance requirements next year, including reviewing the international application of its rules and the Consumer Duty. It also intends to pilot sector guides to help smaller financial firms apply outcomes-based regulation, starting with consumer credit firms next year, with the pilot informing its longer-term approach.