Consumer Duty turns two

It continues to be the FCA’s flagship policy with its four outcomes driving a significant portion of the regulator’s work:

1. Products and Services: Ensuring that products are designed to meet the needs and objectives of a target group of customers.
2. Price and Value: Confirming consumers receive fair value for the products and services they purchase.
3. Consumer Understanding: Making sure that consumers can understand the products and services offered to them.
4. Consumer Support: Providing adequate support to consumers to help them make informed decisions.

ITC has helped the network embed the Consumer Duty into their businesses through the training of staff and embedding of systems and controls designed to meet the above outcomes.

 Alongside the regulator’s new supporting growth objective, the broad reach of the Consumer Duty has enabled the FCA to review its existing rules and consider removing some of those that are no longer required.

One of the proposals suggests the removal of the additional rules for motor dealers around the sale of GAP Insurance, such as the two-day moratorium rule. These may no longer serve their purpose, given how the market has changed since these rules were first introduced 10 years ago. Following the changes made to the product after the FCA banned sales for a period in 2024, under the Consumer Duty, GAP Insurance must provide fair value to customers through whatever distribution channel they buy through. Therefore, we believe it is unfair to have rules adding unnecessary friction to sales by motor dealers.

Unsurprisingly, and as part of its ongoing support for network members, ITC has responded to this consultation on your behalf, very much supporting the removal of these rules.

Watch this space!