FCA consults on IDD implementation

Following the publication of the Treasury’s consultation on 27 February 2017, the FCA has published the first of its two-part consultation on the transposition of the Insurance Distribution Directive (IDD) which must take place by 23 February 2018. The IDD will replace the Insurance Mediation Directive (IMD).

The FCA’s first consultation paper covers its proposals for the following areas:

• application of the IDD (Chapter 2);
• professional and organisational requirements (Chapter 3);
• complaints handling and out-of-court redress (Chapter 4);
• changes to conduct of business rules (for non-investment insurance contracts) (Chapter 5); and
• the regulatory regime for ancillary insurance intermediaries (Chapter 6).

The FCA’s proposals will require changes to the SYSC, TC, MIPRU, IPRU(INV), ICOBS and DISP sourcebooks. The consultation also proposes a wider change to the definition of ‘durable medium’ in the Handbook, which is likely to impact most financial services firms.

We h ave written an article on the Treasury’s implementation proposals. The FCA asks for comments by 5 June 2017 and plans to issue its rules in a policy statement by September 2017. The FCA’s second consultation paper will be published later this year.