Header graphic for print

Global Insurance Blog

International Insurance and Reinsurance News, Trends, and Cases

Posted in Regulatory and legislative updates, UK

UK: PPI Update – November 2018

FCA publishes final guidance on regular premium PPI complaints and new consultation on mailing rules

On 7 November 2018, the FCA released a consultation paper (CP18/33) publishing final guidance clarifying its expectations about the handling of mis-selling complaints relating to regular premium PPI, and proposing new mailing rules requiring firms to write to previously rejected complainants.

CP18/33 follows the FCA’s July 2018 consultation paper (CP18/18) in which the FCA sought responses on whether firms should consider recurring non-disclosure of commissions or profit-share (“RND”) when assessing mis-selling complaints in relation to regular premium PPI policies.  For further information on CP18/18, see this blog post from Hogan Lovells.  See here for previous blog posts on PPI mis-selling and the impact of the Supreme Court decision in Plevin v Paragon Personal Finance Limited (“Plevin“) more generally. Continue Reading

Posted in Regulatory and legislative updates, UK

UK: Corporate Insurance Newsletter – October 2018

The Hogan Lovells’ Corporate Insurance Newsletter for October has been published.  This provides a round-up of UK, EU and international regulatory developments relevant to UK based insurance market participants.  In this issue, amongst other items, we cover:

  • Latest Brexit related consultation papers and other material from the Bank of England, PRA and FCA
  • The FCA thematic review report on pricing practices
  • The PRA’s updated approach to the supervision of insurance document
Posted in Regulatory and legislative updates, UK

UK: FCA publishes PPI complaints deadline progress report

On 24 October 2018, the FCA published a report on the progress of its consumer communications campaign on PPI mis-selling (the “CCC”) and its supervision of the manner in which firms are handling PPI complaints.

The progress report is the latest of a series of publications from the FCA on PPI mis-selling following the Supreme Court decision in Plevin v Paragon Personal Finance Limited, in which the Court held that a lender’s failure to disclose the level of commission taken from a PPI sale gave rise to an unfair relationship between creditor and borrower under the Consumer Credit Act.  Previous blog posts from Hogan Lovells have considered these FCA publications and the associated regulatory changes in detail, most recently our blog post on the FCA’s July 2018 consultation paper. Continue Reading

Posted in European Union, Regulatory and legislative updates, UK

The time is now: EIOPA calls for action to ensure service continuity in cross-border insurance

Following its Opinion on 21 December 2017, the European Insurance and Occupational Pensions Authority (EIOPA), yesterday (5th November) issued a call to action to ensure service continuity in cross-border insurance.

In the December 2017 Opinion, EIOPA urged insurance undertakings and regulators to take the necessary steps in good time to ensure the continuity of cross-border insurance contracts between the UK and EEA following Brexit. Now, EIOPA calls for “immediate and reinforced action” by insurance undertakings and regulators in order to avoid disruptions to service continuity. Continue Reading

Posted in Market developments, Regulatory and legislative updates, UK

Webinar – Recent developments in Part VII transfers and schemes of arrangement for insurers

Part VII transfers continue to be an important tool for both M&A and group reorganisations in the insurance industry, not least because of Brexit. In addition, there is an increasing interest in the use of schemes of arrangement to restructure insurance businesses.

Click here to read more and to register for the Webinar.

Posted in European Union, Regulatory and legislative updates, UK

No deal Brexit – Government publishes advice on vehicle insurance

On 24 September 2018, the Government published a technical notice on vehicle insurance if there is no Brexit deal.

The current position

Motorists from non-EU countries driving in the EU must have a Green Card, an internationally recognised certificate issued by their motor insurer as proof that they have third party motor insurance cover for driving in the country of travel. Currently, EU based private and commercial motorists do not need a Green Card to drive in the EU and EEA countries and in Andorra, Serbia and Switzerland as these countries benefit from being in the EU’s ‘Green Card-free circulation area’.  Continue Reading

Posted in Market developments, Regulatory and legislative updates, USA

US: NAIC Developing Best Practices for Regulatory Review of Predictive Models and Analytics in Rate Filings

As computing power grows exponentially, it has opened the actuarial modeling world to new and sophisticated forms of data collection and analysis, resulting in insurance companies seeking increased “predictiveness” of potential losses by employing ever more complex modeling methods in establishing, and justifying, premium rates.

Predictive analytics, which involve a number of techniques, including data mining, statistical modeling and machine learning, in its forecasts, allows insurers to use “big data” to more precisely forecast future events.
Continue Reading

Posted in Case reports, UK

UK: Sanctions exclusion clauses: What can we learn from Mamancochet Mining Limited v Aegis Managing Agency Limited and Others [2018] EWHC 2643 (Comm)?

On 12 October 2018 the High Court handed down judgment in a case that concerned a claim brought against insurers for payment under a marine cargo policy relating to the theft of steel billets from an Iranian port in late 2012. The 11 defendant underwriters sought to rely on a London standard insurance market sanctions exclusion clause included within the policy in resisting payment of the claim:

No (re)insurer shall be deemed to provide cover and no (re)insurer shall be liable to pay any claim or provide any benefit hereunder to the extent that the provision of such cover, payment of such claim or provision of such benefit would expose that (re)insurer to any sanction, prohibition or restriction under United Nations resolutions or the trade or economic sanctions, law or regulations of the European Union, United Kingdom or United States of America“. Continue Reading

Posted in Regulatory and legislative updates, UK

UK: The FCA consults on new SM&CR guidance on statements of responsibilities and responsibilities maps

On 11 October 2018, the FCA published a guidance consultation for FCA-authorised firms on preparing statements of responsibilities and responsibilities maps under the Senior Managers and Certification Regime (SM&CR). Under the SM&CR, which will apply to all FCA authorised firms from 9 December 2019, firms will be required to prepare statements of responsibilities for each senior manager, and all enhanced firms will be required to have a responsibilities map.

While the guidance is directed at FCA-authorised firms, the FCA has indicated that it may also be useful for dual-regulated firms such as insurers and banks, which will also be required to prepare these documents.

The proposed guidance sets out the purpose of statements of responsibilities and responsibilities maps, questions for firms to ask themselves when drafting these documents and examples of good and poor practice. These examples are followed by analysis and commentary from the FCA, and provide a useful reference tool for firms preparing their statements of responsibilities and responsibilities maps. The guidance provides analysis relevant for each category of firm subject to the regime (limited, core, as well as enhanced firms). The guidance also contains example responsibilities maps for firms to consider.

The guidance is stated to be non-binding and a departure from it will not necessarily indicate a breach of the rules. Firms may apply the guidance in a risk-based and proportionate way by considering the size, nature and complexity of the firm. In a speech today, David Blunt, Head of Conduct Specialists at the FCA, indicated that the guidance has been generated following lessons learned from applying the SM&CR for banks and other firm types which are already subject to the regime. He indicated that the purpose of the examples provided is to help firms think about what should be included in these documents, but that these examples should not be slavishly or strictly followed or copied. In practice, firms should have regard to this guidance to ensure that the documents they produce take account of the FCA’s expectations.

In our experience, preparing compliant and representative responsibilities maps and statements of responsibilities documents can be a time-intensive process and is often an area of considerable uncertainty for firms seeking to comply. In the past, regulators have provided fairly limited guidance on what these documents should look like. It is therefore helpful that the FCA has decided to provide more detailed guidance in this area.

The deadline for comments on the consultation is 10 December 2018. For further detail on the proposed guidance from the FCA as well as how to respond to the consultation, please see https://www.fca.org.uk/publications/guidance-consultations/gc18-4-senior-managers-and-certification-regime-proposed-guidance-statements-responsibilities-firms

For more information on the near final rules on SM&CR released by the FCA and PRA, see https://www.hoganlovells.com/en/blogs/fision/the-fca-and-the-pra-have-released-near-final-rules-on-the-senior-managers-and-certification-regime

Please let us know if you would like to find out more about how we can help you implement the regime. We are able to offer flexible support to reflect your firm’s business needs. We can run your entire implementation project using a mix of our legal and consulting offering, provide legal advice on the key requirements and what you need to do to implement the regime, or provide template documentation to help you design and implement your own project. Let us know how we can help. 

Posted in Regulatory and legislative updates, UK

UK: Corporate Insurance Newsletter – September 2018

The Hogan Lovells’ Corporate Insurance Newsletter for September has been published.  This provides a round-up of UK, EU and international regulatory developments relevant to UK based insurance market participants.  In this issue, amongst other items, we cover:

  • Publication of a speech by David Rule at the PRA about current issues in insurance supervision.
  • A new consultation paper from the PRA on implementation of the SM&CR
  • Launch of a new insurer start-up unit by the PRA and FCA