UK & Europe
Insurance & Reinsurance
MGAs and other intermediaries may struggle to manage the complexities of the recently introduced Senior Managers and Certification Regime (SMCR) and fall foul of FCA conduct rules in 2020.
The SMCR is a complicated regulatory requirement and some FCA solo regulated firms, typically brokers and MGAs, will struggle to implement it with the possibility that some will not take the appropriate steps to meet its requirements.
In particular, getting to grips with the detailed requirements of the SMCR, such as statements of responsibility, annual fit and proper certification and regulatory references will prove a significant challenge, particularly for those smaller firms with limited internal compliance, HR and legal resources to draw on.
In addition, the need for almost all staff to comply with the FCA's Conduct Rules, with significant regulatory sanctions available for breaches, should help to drive a cultural change in the intermediary sector.
The London Market behavioural and #MeToo issues first exposed in the infamous Bloomberg article published in March this year, and expanded upon in Lloyd's own report will continue to be a significant theme next year. It is clear there is only one direction of travel and that market participants need to clean up their act. John Neal must be seen to be leading the way on this issue and a high profile ‘scalp’ is possible as it would go a long way to reinforcing the 'no tolerance' message.
Read the rest of our insurance predictions here.