The FCA has published a ‘Dear CEO‘ letter addressed to Lloyd’s and London Market Insurers, providing an overview of the areas of focus of its supervision strategy.
In particular, the letter sets out the FCA’s view of the key potential risks of harm to customers and the market in which Lloyd’s and London Market Insurers operate in. Potential risks include ineffective governance and oversight, culture and non-financial misconduct, and inefficient and poorly controlled general insurance distribution chains.
The letter also outlines the FCA’s expectation of firms and how they should be mitigating risks of harm through good governance; and allows firms to consider the degree to which it presents such risks and its strategies for mitigating them.
The FCA have said that, upon contacting firms, it will expect firms to be able to explain what firms have done in response to this letter.