Issuing a few key facts
Q. I heard that we don't need to issue Keyfacts documents any more. Is this true?
August is referred to as the 'silly season' but do not get carried away. It is always a surprise when brokers get a piece of information, then take it to mean what they decided that it would mean. Please, read this carefully!
At the beginning of July 2007 the FSA issued a consultation paper CP07/16 that covered proposed changes to the ICOB rules. Read it in full at http://www.fsa.gov.uk/pages/Library/Policy/CP/2007/07_16.shtml.
However, it does propose that ICOB be replaced with NEWCOB and within the proposals are a number of issues of which brokers should be aware. Assuming that the proposals are adopted, they will come into force in January next year.
The highlights are: status and service information currently within the IDD will remain; policy summary or keyfacts document will no longer be required - except on PPI or pure protection contracts; demands and needs statements will still be required for all commercial and personal risks; 'retail' and 'commercial' classifications will disappear, to be replaced with a sole category of 'consumer'; and as a result, the 21 day rule for renewals will be withdrawn and replaced by a single 'in good time' requirement.
No doubt, in the coming weeks and months, guidance will be sought as to a definition of 'in good time' and firms that use a compliance consultant will be kept appraised of what is necessary in their own case.
I must stress that the above are proposals and the FSA have made it clear that failure to comply with the current rules can still lead to enforcement action.
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