FCA Business Plan 2015/16

Ciara Russell contributed to the writing of this blog post.

Last week, the Financial Conduct Authority (FCA) published its business plan for the year 2015/16.  The plan covers:

  • Risk outlook (previously a separate document)
  • FCA strategy
  • FCA’s key priorities
  • Ongoing activities and deliverables
  • How the FCA operates

In this blog, we summarise the risk outlook, how the insurance sector is impacted by the FCA’s upcoming activities and look at relevant market studies.

Risk outlook

The business plan discusses some key areas of risk for the financial services market. These are summarised below:

Category Risks
Business Conduct

Firm's culture

Consumer behaviours

Conflicts of interest, with a focus on wholesale markets

Financial crime

Unfair contract terms

Policy, legislation and regulation

EU and international

Market infrastructure


Shadow banking

Domestic policy

Pension reforms

Consumer credit

Economic and market trends Trends in growth, interest rates and inflation
Social factors

The ageing population and older consumers

Young consumers

Technological challenges

Innovation in online and web-based channels


Complex systems and intermediaries and/or gatekeepers

Failure to invest and maintain

Market resilience

Key priorities

The FCA key priorities that are applicable to the insurance sector are:

  • Role of Appointed Representatives – The FCA will review the role of Appointed Representatives in the distribution of general insurance products and in particular, if there are adequate and robust systems, controls and resources to effectively select and oversee Appointed Representatives.
  • Technology and use of Big Data – A market study will be conducted to investigate how insurance firms use Big Data or other unconventional data sources. The FCA will consider potential risks and benefits and ensure regulations do not unduly constrain beneficial innovation in this area.
  • General insurance add-ons – The FCA plan to address issues found in a 2014 market study. These include banning ‘opt-out’ selling across all products sold by an authorised firm and issuing guidance to improve the way add-ons are sold on price comparison websites.

Current and planned market studies and thematic work

Studies applicable to the insurance sector are:

Sector Review                                                                       Start date End date        
Cross sector

Visibility of IT resilience and risks at Board Level     

Performance management of staff

Culture review

Q1 2014

Q4 2014


Q2 2015    

Q3 2015


General insurance and protection

Commercial claims by SME customers

Distribution chains

Role of Appointed Representatives

Technology: use of Big Data and access market study

Q3 2014

Q3 2014


Post April 2016

Q2 2015




You can read the FCA’s business plan in full here: http://www.fca.org.uk/static/channel-page/business-plan/business-plan-2015-16.html

Key takeaways

  • Technological risks continue to feature on the FCA’s radar as can be seen in their risk outlook, priorities and market studies.
  • Appointed Representatives for general insurance firms are a key priority.