Compliance experts disagree with FCA's potential phased implementation period for Consumer Duty

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Compliance professionals have come out against any delay in the Financial Conduct Authority implementing Consumer Duty rules as the watchdog ponders switching to a phased implementation period.

The regulator detailed last December that it would introduce a consumer duty to increase customer protection with final rules due at the end of this month with an implementation period running to 30 April 2023.

However, at the beginning of July, the FCA revealed all options were on the table ahead of possible phased implementation period. Reports suggested this could involve delays of up to six months. 

Compliance experts have argued the original date for the regulations to be applied should be kept.

Branko Bjelobaba, principal of compliance consultancy Branko, said: “A good firm will be able to easily get their heads round the sensible set of requirements by April 2023.”

Managing director of Dart Compliance, James Dart, agreed the deadline should be maintained. He commented: “I don’t believe that it is necessary for the general insurance industry, who have had a customer’s best interest rule for the past three years, to have a delay. They should almost be there on what is required.

“Other sectors need to consider the new duty and principle and ask themselves why implementation should be problematic, are they not acting in the best interests of their customers?”

However, Dart added he understood there had been a plethora of regulatory change, which was caused “by the logjam of inactivity during the pandemic.” He also stated that some firms feel overwhelmed but “the requirements should not be a surprise to anyone”.


Director of compliance and training firm Create Solutions, Mike Cranny, also disagreed with a possible delay.

He observed financial firms want a delay because “not much planning has taken place” and that “the market doesn’t understand what is being asked of them”.

However, director of Implement Compliance Solutions and Resources, Kenneth Underhill felt the delay could be welcomed.

He commented: “The changes are likely to be quite significant as it will impact board, board committees and any product governance oversight as well as the business at functional levels so any delay to allow firms to prepare should be welcomed.

“Many firms are struggling because of how much change they are already trying to deal with as well as grow at a time when resources are very hard to come by.”

Underhill was also understanding on the length of any potential delay.

He said: “If six months is what is required to ensure firms get with the program then they should be permitted the time. However, firms must realise the FCA will expect full compliance and no laggards if there is any extension.”


The British Insurance Brokers’ Association has advised brokers to keep preparing on the basis of the current known timeline.

Dart stated firms should be investing in training, so staff are able to understand what products they sell and the benefits, risk, and sustainability of them.

He continued: “GI Intermediaries need to understand that service is important to customers and consider not placing business with those insurers whose service offering does not support both the broker and their client.”

Dart also said he agreed with the new regulations and that the pandemic revealed why they needed to be made.

He commented: “Extending the definition of consumers to include SME commercial is welcomed when the pandemic has highlighted the fragility and a general lack of resilience in that sector.”

Cranny said firms should hold a “massive review and start buying your own policies, putting yourself and relatives through your process … [and] setting up consumer groups and inviting them to sit on your board”.

The Consumer Duty

The Consumer Duty regulations have been the “biggest change since the FCA started”, according to Cranny.

He added: “Firms need to start thinking out of the insurance box to ensure customers really are at the ‘heart of all we do’.”

Underhill said the Consumer Duty was the “obvious next step” and “better regulation is better for the market and consumers”.

The regulator will make a final decision on the way forward by the end of July after its next scheduled board meeting.

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