PS23/18: Smarter Regulatory Framework: The Insurance Distribution Directive

The Financial Conduct Authority (FCA) has issued a new policy statement (PS23/18) in connection with its proposed amendments and additions to the FCA Handbook to implement provisions for the replacement of four delegated acts under the retained Insurance Distribution Directive (UK IDD), namely
– Retained Commission Delegated Regulation (EU) 2017/2359,
– Retained Commission Implementing Regulation (EU) 2017/1469,
– Retained Commission Delegated Regulation (EU) 2017/2358, and
– Retained Commission Delegated Regulation (EU) 2019/1935 (this one would be repealed WITHOUT replacement).
To recall, the FCA launched a corresponding consultation (CP23/19) earlier in 2023 to follow up on the government’s intention to replace all retained EU legislation (REUL) following Brexit. The intention of the FCA was NOT to impose further requirements upon insurance and reinsurance undertakings, but „simply“ to adopt equivalent provisions to replace those in the delegated acts. In this context, the FCA also proposed some minor editorial changes such as the replacement of the word „customer“ throughout with the word „client“ to align with other provisions in the FCA Handbook. The same holds true for the word „shall“ which the FCA proposed to replace with the word „must“. Furthermore, the FCA suggested to eliminate all references to other EU law included in the legal papers.
For a detailed description of the delegated acts, please refer to the consultation in EventID 22905.
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In its final policy statement now, the FCA briefly summarizes the responses it received to its consultation and presents its way forward in this matter. Thereafter, the regulator will proceed as proposed and implement the provisions without any changes. This is because most respondents strongly agreed with the FCA’s proposal and only one commenter sought clarification on an already explained issue relating to the product information that shall be provided to customers.
We would also like to refer to Annex 4 in this context which presents a mapping table between the articles in the noted delegated acts and the corresponding upcoming rules and sections in the FCA Handbook – if applicable.
Finally, the corresponding legal document to implement the new policy statement is presented in EventID 24506.