GAP insurers ordered to pause sales
28 March 2024
The Financial Conduct Authority (FCA) has ordered providers of Guaranteed Asset Protection insurance (GAP) to pause sales of the product by the end of March.
This development follows our update in The Word last month, regarding the FCA’s announcement that multiple insurance firms had agreed to pause sales of GAP, at its request. The firms that have already taken such action account for 80% of the GAP insurance market, leaving the remaining 20% to pause sales this month.
The action comes in light of the FCA’s previous concerns that GAP insurance was failing to provide fair value to some consumers. The FCA have discussed the need to see improvements in the product and its readiness to review revised proposals by firms as soon as possible, stating:
“We are working closely with GAP insurers to resolve these issues as quickly as possible, so that customers can access fair value products that meet their needs”
How can we assist?
Contact our team about how we can assist your firm with the Consumer Duty, including:
- Insurance policy wording and associated document health checks, including advice as to any legal or regulatory issues or areas where the document has an increased risk of uncertainty.
- Readability analysis - assessment of the reading age of the wording, together with a word frequency analysis (identifying words which readers are unlikely to encounter in their everyday lives and which are shown to hinder understanding).
- Consumer testing - identifying key customer outcome measures for customer-facing documents, improving clarity and testing with large numbers of customers to establish levels of understanding.
Contents
- The Word, March 2024
- Explaining artificial intelligence use to insurance customers
- Lloyd’s Market Association Update
- Consumer Duty: Financial Conduct Authority (“FCA”) highlights areas of improvement
- UK Cyber Governance Code
- Insurance and Taylor Swift’s Eras tour
- Financial Conduct Authority enforcement to go public – a step too far?
- How is the National Health Service (NHS) waiting list impacting insurance?
Key contact
Tim Johnson
Partner
tim.johnson@brownejacobson.com
+44 (0)115 976 6557
Contact Tim
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