Following the Supreme Court judgment on the BI test case, the FCA has sent out a Dear CEO letter clarifying what happens next and what it expects of insurers and managing agents.
The FCA says it intends to see that all businesses with valid BI claims receive payments due to them as soon as possible. It aims to ensure that financial pressures on affected policyholders are not exacerbated by any further delay in payment.
The regulator has also published a document which clearly sets out the High Court and Supreme Court judgments in tabular form, broken down by policy type.
The FCA says insurers now have all the clarity they need to wrap up the majority of their BI customers’ claims, which they are encouraged to do as quickly as possible.
It notes that the judgment will mean that some previously rejected claims and complaints are now valid – and/or that the value of claims previously accepted as valid will have changed.
Insurance firms must now write to all affected policyholders clarifying these points and explaining what happens next. Insurers are asked to be transparent, consistent and supportive – and to pay valid claims in full as soon as possible.
If the FCA believes they are not doing this, it will apply the full range of regulatory tools and powers available to it to ensure they do. In the meantime, the regulator says it will continue co-ordinating closely with the Ombudsman.
To find out more about this or any other compliance related issue, contact a member of our expert team on 01925 765777, or email us at firstname.lastname@example.org.