The FCA’s spotlight has turned to the insurance sector in recent years, with a particular focus on CASS 5 obligations.
This was reinforced by a Dear CEO letter, issued by the FCA in July 2021, which emphasised the importance of maintaining adequate client money arrangements for general insurance intermediaries.
In the letter, the FCA shared its concern that over half of insurance firms they assessed had not performed a client money calculation in line with the rules – despite it being a key regulatory requirement for in-scope CASS 5 firms.
What do insurers need to do?
Firms that receive or hold client money in the course of – or in connection with – its insurance distribution activity are subject to CASS 5 regulations. The regulation exists to ensure firms, acting in their capacity as insurance distributors, maintain complete and accurate books and records for clients.
It also aims to make sure firms appropriately segregate client money from their own by ensuring adequate trust arrangements over the funds.
And the rules stipulate that firms must be able to show evidence of CASS compliance.
The FCA takes a zero-tolerance approach on client money failing. It is therefore vital that firms ensure compliance with existing rules.
To make it easier for insurers to comply with CASS, we’ve put together a comprehensive resource on everything firms need to know about this area of regulation.
Download this paper to learn:
- Why the FCA is focusing on CASS 5
- The latest updates insurers must be aware of
- The other CASS regulations affecting insurers
- Best practices
- Key requirements outlined in the FCA Client Money Guide
To access this resource, please complete the short form provided.