Consumer Duty

What it means for us, our customers and distribution partners.

The Financial Conduct Authority’s (FCA) Consumer Duty brings a new era for our industry, with a set of rules that call for a higher standard of customer care and protection for retail customers which all financial services firms are expected to follow. It has one core principle – to act to deliver good outcomes for retail customers.

On 27th July 2022 the FCA published its policy statement, final rules and accompanying non-handbook guidance. The implementation timeline has been set to the following milestones:

  • By the end of April 2023, all providers should have completed the reviews necessary to meet the outcome rules for their existing open products and services, ready to share with distributors to meet their obligations under Consumer Duty, and identify where changes need to be made
  • From the end of July 2023, the Consumer Duty applied to all new products and services, and all existing products and services that remain on sale or open for renewal
  • From the end of July 2024, the Consumer Duty will come fully into force and also apply to all closed products and services

To meet the new rules, the FCA has outlined four key outcomes that set out their expectations of firms in relation to:

Products and services
Price and value
Consumer understanding
Consumer support

The following cross-cutting rules set out the overarching standards of conduct which firms must demonstrate when they act to deliver good outcomes for retail customer across each of the outcomes.

  • Act in good faith towards retail customers
  • Avoid causing forseeable harm to retail customers
  • Enable and support retail customers to pursue their financial objective

This framework helps to ensure all firms have suitable controls in place to monitor whether good customer outcomes are being delivered, and also includes advice firms.

Many of our distribution partners are already delivering good outcomes for their clients and we fully support continuing to work together to uphold this standard.

However, Consumer Duty means that we all have to do more to document and evidence that the solutions and recommendations do deliver good customer outcomes. We’ll support this by:

  • Sharing deeper customer insight through our customer testing programmes
  • Providing clarity on what constitutes a ‘good outcome’, as well as addressing any foreseeable harm to customers, with a particular focus on vulnerable customers
  • Offering deeper knowledge about customer needs and behaviours, using behavioural bias to understand the impact on the financial advice process and the implications and opportunities for our distribution partners

As a financially stable and thriving business, we fully embrace this opportunity to set the benchmark for modern life companies and for which we’ll be held accountable throughout the whole proposition lifecycle. The new customer-led principles and standards are at the centre of everything we do and we’re including all of our jurisdictions.

For more details on our approach to Consumer Duty, read the Frequently Asked Questions below. 

Frequently Asked Questions