Understanding FSA
About ICOB
The ICOB rules apply to the following types of insurance:
- Building and Contents
- Motor
- Commercial
- Accident, Sickness and Unemployment
- Payment Protection
- Term Life and Critical Illness
- Travel (though not when sold as part of a holiday package)
In fact, every general insurance product needs to comply with the FSA's new rules
The Insurance Conduct of Business ICOB Rules
These FSA rules formalise good business practice in the sales, administration, claims handling and marketing of general insurance and incorporate various European directives.
In relation to the sale of general insurance the key areas that the rules affect are:
- Advertising and selling standards
- Product disclosures
- Cancellation rights
- Claims Handling
- Financial promotions (Advertising)
Underpinning these rules are the FSA's key principles that business must operate within. These are;
- Integrity
- Skill, Care and Diligence
- Management and control
- Financial prudence
- Market conduct
- Customers' interests
- Communications with customers
- Conflicts of interest
- Customers relationships of trust
- Customers' assets
- Relationship with regulators
It is these key principles that organisation will be measured against. In essence the rules are designed to ensure that the customer knows / understands:
- Who they are dealing with
- What product they are buying
- Whether the product meets their needs
- What rights they have to cancel
- And how to make a claim
The Insurance conduct of Business set out the rules that govern the sale of general insurance into the following three key areas:
- Advising and selling
- Product Disclosure
- Cancellations
