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ICOBS 6.-1 Producing and providing product information

Responsibilities for producing and providing information as between insurers and insurance intermediaries: general

ICOBS 6.-1.1 R

1An insurer is responsible for producing, and an insurance intermediary for providing to a customer, the information required by this chapter and by the distance communication rules (see ICOBS 3.1). However, an insurer is responsible for providing information required on mid-term changes, and an insurance intermediary is responsible for producing price information if it agrees this with an insurer.

ICOBS 6.-1.2 R

1If there is no insurance intermediary, the insurer is responsible for producing and providing the information.

ICOBS 6.-1.3 R

1An insurer must produce information in good time to enable the insurance intermediary to comply with the rules in this chapter, or promptly on an insurance intermediary's request.

ICOBS 6.-1.4 R

1These general rules on the responsibilities of insurers and insurance intermediaries are modified by ICOBS 6 Annex 1 if one of the firms is not based in the United Kingdom, and in certain other situations.

Responsibility for producing the standardised insurance product information document

ICOBS 6.-1.5 R

1The IPID must be drawn up by the manufacturer of the policy.

[Note: article 20(6) of the IDD]

ICOBS 6.1 Providing product information to customers: general

ICOBS 6.1.1 R RP

[deleted]6

1
ICOBS 6.1.2 R RP

[deleted]6

ICOBS 6.1.3 R RP

[deleted]6

ICOBS 6.1.4 R RP

[deleted]6

Ensuring customers can make an informed decision: the appropriate information rule

ICOBS 6.1.5 R RP
  1. (1)

    A firm must ensure that a customer is given appropriate information about a policy in good time and in a comprehensible form so that the customer can make an informed decision about the arrangements proposed.6

  2. (2)

    The information must be provided to the customer: 6

    1. (a)

      whether or not a personal recommendation is given; and6

    2. (b)

      irrespective of whether a policy is offered as part of a package with:6

      1. (i)

        a non-insurance product or service (seeICOBS 6A.3 (Cross-selling)); or6

      2. (ii)

        another policy. 6

  3. (3)

    Appropriate information is both objective and relevant information, and includes IPID information.6

  4. (4)

    Where the firm is proposing a policy (including if appropriate on renewal) ‘in good time’ means in good time prior to the conclusion of the policy.6

[Note: articles 20(1) first paragraph and 20(4) of the IDD]6

ICOBS 6.1.6 G RP

The appropriate information rule applies: 6

  1. (1)

    at all of the different stages of a contract and includes pre-conclusion and post-conclusion, and also when mid-term changes and renewals are proposed;6

  2. (2)

    in the same way to any policy, regardless of whether that policy is sold on its own, in connection with another policy, or in connection with other goods or services; and6

  3. (3)

    to the price of the policy.6

ICOBS 6.1.6A G RP

[deleted]6

3

What level of information needs to be provided?

ICOBS 6.1.6B R

6A firm must ensure that the level of appropriate information provided takes into account the complexity of the policy and the type of customer.

[Note: article 20(4) of the IDD]

ICOBS 6.1.7 G RP

The level of information required will vary according to matters such as:

  1. (1)

    the knowledge, experience and ability of a typical customer for the policy;

  2. (2)

    the policy terms, including its main benefits, exclusions, limitations, conditions and its duration;

  3. (3)

    the policy's overall complexity;

  4. (4)

    whether the policy is bought in connection with other goods and services including another policy (also see ICOBS 6A.3 (cross selling))6;

  5. (5)

    distance communication information requirements (for example, under the distance communication rules less information can be given during certain telephone sales than in a sale made purely by written correspondence (see ICOBS 3.1.14 R)); and

  6. (6)

    whether the same information has been provided to the customer previously and, if so, when.

Appropriate information regarding medical condition exclusions in travel insurance policies

ICOBS 6.1.7-A G
  1. (1)

    78This guidance is relevant to a firm when it provides a consumer with:

    1. (a)

      a quotation for a travel insurance policy; or

    2. (b)

      a statement (provided under ICOBS 5.1.3CR(1)) in respect of a travel insurance policy included in a packaged bank account.

  2. (2)

    At the same time as it provides the information in (1), the firm should:

    1. (a)

      disclose to the consumer whether any medical condition exclusion can be removed from the policy (in whole or in part); and

    2. (b)

      if so, how, and the terms on which it can be removed.

  3. (3)

    Firms are also reminded of their obligations in ICOBS 5.2.2BR to ensure the policy proposed is consistent with the consumer’s insurance demands and needs.

Appropriate information for commercial customers

ICOBS 6.1.7A G

6A firm dealing with a commercial customer:

  1. (1)

    may choose to provide some of or all of the appropriate information in an IPID (see ICOBS 6.1.10AR), a policy summary or a similar summary if it considers this to be a comprehensible form in which to provide that information; and

  2. (2)

    should include the IPID information (regardless of whether an IPID itself is provided).

ICOBS 6.1.8 G RP

[deleted]6

ICOBS 6.1.9 G RP

Cancellation rights do not affect what information it is appropriate to give to a customer in order to enable him to make an informed purchasing decision.

ICOBS 6.1.10 G RP

[deleted]6

How must IPID information be provided?

ICOBS 6.1.10A R

6A firm, when dealing with a consumer must provide the IPID information by way of an IPID for each policy (other than a pure protection contract).

[Note: articles 20(4) and 20(5) of the IDD]

ICOBS 6.1.10B G

6The IPID information:

  1. (1)

    needs to be provided on paper or on another durable medium;

  2. (2)

    in the case of telephone selling, a firm may provide the IPID in accordance with the distance communication timing requirements and provide the IPID to the customer immediately after the conclusion of the policy,

in accordance with ICOBS 6.6 (Means of communication).

[Note: article 23(7) of the IDD]

How must appropriate information other than IPID information be provided?

ICOBS 6.1.10C G
  1. (1)

    6Appropriate information other than IPID information includes, among other matters, any other information required by the appropriate information rule (ICOBS 6.1.5R), specific price disclosure requirements (ICOBS 6.1.13R), Solvency II Directive disclosure requirements (ICOBS 6.2.2R), renewals (ICOBS 6.5) and guaranteed assets protection (GAP) products (ICOBS 6A.1.4R).

  2. (2)

    A firm needs to consider the form in which it provides appropriate information (see ICOBS 6.1.5R).

  3. (3)

    A firm can provide the other information in (1) together with the IPID as long as the IPID remains a stand-alone document.

[Note: article 20(4) and article 20(7) last paragraph of the IDD]

Interaction between information provision requirements and the customer’s best interests rule and Principle 7

ICOBS 6.1.11 G RP

To comply with the customer’s best interest rule and Principle 7 (communication with clients) a firm should:6

  1. (1)

    include consideration of the information needs of the customers including:6

    1. (a)

      what they need to understand the relevance of any information provided by the firm; and6

    2. (b)

      at which point in the sales process will the information be most useful to the customer to enable them to make an informed decision;6

  2. (2)

    provide evidence of cover promptly after inception of a policy,6

taking into account the type of customer and the effect of other information requirements, for example, those under the distance communication rules (ICOBS 3.1); and6

  1. (3)

    in relation to a group policy, provide appropriate information to the customer, telling the customer to pass it on to each policyholder.6

Under Principle 7 a firm should provide evidence of cover promptly after inception of a policy. Firms will need to take into account the type of customer and the effect of other information requirements, for example those under the distance communication rules (ICOBS 3.1).

ICOBS 6.1.12 G RP

[deleted]6

Renewals

ICOBS 6.1.12A R RP

[deleted]6

ICOBS 6.1.12B G RP

[deleted]6

4

What additional information must be disclosed for packaged products and other relevant requirements?

ICOBS 6.1.13 R RP
  1. (1)

    If a policy is bought by a consumer in connection with other goods or services a firm must, before conclusion of the contract, disclose its premium separately from any other prices and whether buying the policy is compulsory.

  2. (2)

    In the case of a distance contract, disclosure of whether buying the policy is compulsory may be made in accordance with the timing requirements under the distance communication rules (see ICOBS 3.1.8 R, ICOBS 3.1.14 R and ICOBS 3.1.15 R).

  3. (3)

    2This rule does not apply to policies bought in connection with other goods or services provided as part of a packaged bank account.

ICOBS 6.1.13A G RP

In addition to the requirements in ICOBS 6.1 (Product information) firms are reminded that:6

  1. (1)

    when offering a policy as part of a packaged bank account the firm may be subject to the requirements of regulation 13 (payment accounts packages with another product or service) of the Payment Accounts Regulations;6

  2. (2)

    ICOBS 6A.3 (Cross-selling) contains rules in relation to packages which include both insurance and non-insurance products or services.6

5
ICOBS 6.1.14 R RP

[deleted]6

ICOBS 6.2 Pre-contract information: general insurance contracts

Application: what?

ICOBS 6.2.1 R RP

This section applies in relation to a general insurance contract.

Solvency II Directive derived disclosure requirements1

ICOBS 6.2.2 R RP

Before a general insurance contract is concluded, a firm must inform a customer who is a natural person of:

  1. (1)

    the law applicable to the contract where the parties do not have a free choice, or the fact that the parties are free to choose the law applicable and, in the latter case, the law the firm proposes to choose; and

  2. (2)

    the arrangements for handling policyholders’ complaints concerning contracts including, where appropriate, the existence of a complaints body (usually the Financial Ombudsman Service), without prejudice to the policyholders’ right to take legal proceedings.

[Note: article 183(1) to (2) of the Solvency II Directive1]

1
ICOBS 6.2.3 R RP
  1. (1)

    A firm which has its head office in the European Economic Area2 must inform a customer, before any commitment is entered into, of the state2 in which the head office or, where appropriate, the branch with which the contract is to be concluded, is situated.

    1111
  2. (2)

    Any documents issued to the customer must convey the information required by this rule.

[Note: article 184(1) of the Solvency II Directive1]

1
ICOBS 6.2.4 R RP

A firm which has its head office in the European Economic Area2 must ensure that the contract or any other document granting cover, together with the insurance proposal where it is binding upon the customer, states1 the address of the head office, or, where appropriate, of the branch of the firm1 which grants the cover.

1 1 1 1

[Note: article 184(2) of the Solvency II Directive1]

1

Disclosure of cancellation right

ICOBS 6.2.5 R RP
  1. (1)

    A firm must provide a consumer with information on the right to cancel a policy.

  2. (2)

    The information to be provided on the right to cancel is:

    1. (a)

      its existence;

    2. (b)

      its duration;

    3. (c)

      the conditions for exercising it;

    4. (d)

      information on the amount which the consumer may be required to pay if he exercises it;

    5. (e)

      the consequences of not exercising it; and

    6. (f)

      the practical instructions for exercising it.

  3. (3)

    The information must be provided in good time before conclusion of the contract and in writing or another durable medium.

Auto-renewal

ICOBS 6.2.6 R
  1. (1)

    3A firm must:

    1. (a)

      inform a consumer whether the terms and conditions of their policy provide for the policy to automatically renew at the end of the term;

    2. (b)

      provide the consumer with an explanation of the effect of automatic renewal for them; and

    3. (c)

      provide the consumer with information on the right to cancel the automatic renewal element of the policy at any time.

  2. (2)

    The information on the right to cancel the automatic renewal element must include:

    1. (a)

      the existence of the right;

    2. (b)

      the conditions for exercising it;

    3. (c)

      the consequences of exercising it; and

    4. (d)

      the practical instructions for exercising it.

  3. (3)

    The information in (1) and (2) must be provided:

    1. (a)

      in good time before conclusion of the contract; and

    2. (b)

      in writing or in another durable medium.

  4. (4)

    Paragraphs (1) to (3) do not apply in the case of a contract for private health or medical insurance, or pet insurance.

ICOBS 6.2.7 G

In the case of a packaged bank accountICOBS 5.1.3CR(1A) provides that the information required by ICOBS 6.2.6R should be provided in the eligibility statement.

ICOBS 6.3 Pre- and post-contract information: pure protection contracts

Solvency II Directive derived disclosure requirements1

ICOBS 6.3.1 R RP
  1. (1)

    Before a pure protection contract is concluded, a firm must communicate, at least,1 the information in the table below to the customer.1

    1
  2. (2)

    The information must be provided in a clear and accurate manner, in writing, and in an official language of the State of the commitment or in another language if the policyholder so requests and the law of the State of the commitment so permits or the policyholder is free to choose the applicable law.1

    1

    3. Information to be communicated before conclusion

    (1)

    The name of the insurance undertaking and its legal form.

    (2)

    The name of the state2 in which the head office and, where appropriate, the agency or branch1 concluding the contract is situated.

    1

    (3)

    The address of the head office and, where appropriate, of the agency or branch concluding the contract.

    1(3a)

    A concrete reference to the firm'sSFCR allowing the policyholder easy access to this information.

    (4)*

    Definition of each benefit and each option.

    (5)*

    Term of the contract.

    (6)*

    Means of terminating the contract.

    (7)*

    Means of payment of premiums and duration of payments.

    (8)*

    Information on the premiums for each benefit, both main benefits and supplementary benefits, where appropriate.

    (9)*1

    Arrangements for application of the cancellation period.

    (10)

    General information on the tax arrangements applicable to the type of policy.

    (11)

    The arrangements for handling complaints concerning contracts by policyholders, lives assured or beneficiaries1 under contracts including, where appropriate, the existence of a complaints body (usually the Financial Ombudsman Service), without prejudice to the right to take legal proceedings.

    1

    (12)

    The law applicable to the contract where the parties do not have a free choice or, where the parties are free to choose the law applicable, the law the firm1 proposes to choose.

    1

    Note: The rule on mid-term changes applies to items marked with an asterisk (see ICOBS 6.3.3 R).

[Note: article 185 of the Solvency II Directive1]

1
ICOBS 6.3.2 G RP

If the contract is concluded with a commercial customer by telephone, the information in this section may be provided immediately after conclusion.

Mid-term changes

ICOBS 6.3.3 R RP

A firm must keep a customer informed throughout the term of a pure protection contract of any change concerning1 the policy conditions, both general and special, and any change in the following information:1

1 1
  1. (1)

    the name of thefirm,1 its legal form or the address of its head office and, where appropriate, of the agency or branch1 which concluded the contract; and

    111
  2. (2)

    all the information marked ‘*’ in the table of information to be communicated before conclusion, in the event of a change in the policy conditions or amendment of the law applicable to the contract.

[Note: article 185(3) and (5) of the Solvency II Directive1]

1
ICOBS 6.3.4 R RP

1When a firm provides a customer with information in accordance with ICOBS 6.3.3 R, it must provide it in a clear and accurate manner, in writing, in an official language of the State of the commitment, or in another language if the policyholder so requests and the law of the State of the commitment so permits or the policyholder is free to choose the law applicable.

[Note: article 185(3), (5) and (6) of the Solvency II Directive]

ICOBS 6.4 Pre- and post-contract information: protection policies

Application: what?

ICOBS 6.4.1 R RP

This section applies in relation to a payment protection contract or a pure protection contract except as otherwise stated.

Oral sales: ensuring customers can make an informed decision

ICOBS 6.4.2 R RP
  1. (1)

    If a firm provides information orally during a sales dialogue with a customer on a main characteristic of a policy, it must do so for all the policy's main characteristics.

  2. (2)

    A firm must take reasonable steps to ensure that the information provided orally is sufficient to enable the customer to take an informed decision on the basis of that information, without overloading the customer or obscuring other parts of the information.

ICOBS 6.4.3 G RP
  1. (1)

    A policy's main characteristics include its significant benefits, its significant exclusions and limitations, its duration and price information.

  2. (2)

    A significant exclusion or limitation is one that would tend to affect the decision of customers generally to buy. In determining what exclusions or limitations are significant, a firm should particularly consider the exclusions or limitations that relate to the significant features and benefits of a policy and factors which may have an adverse effect on the benefit payable under it. Another type of significant limitation might be that the contract only operates through certain means of communication, e.g. telephone or internet.

Policy summary

ICOBS 6.4.4 R RP

A firm must provide a consumer with a policy summary in good time before the conclusion of a pure protection contract2.

2Complaints and compensation information

ICOBS 6.4.4A R

2In relation to a payment protection contract, a firm must provide a consumer with information about:

  1. (1)

    how the consumer can complain to the insurance undertaking and that complaints may subsequently be referred to the Financial Ombudsman Service (or other applicable named complaints scheme); and

  2. (2)

    the consumer’s entitlement to compensation from the compensation scheme (or other applicable compensation scheme), or that there is no compensation scheme, in the event where the insurance undertaking is unable to meet its liabilities;

in good time before the conclusion of the policy.

Payment protection contracts: importance of reading documentation

ICOBS 6.4.5 R RP
  1. (1)

    A firm must draw a consumer's attention to the importance of reading payment protection contract documentation before the end of the cancellation period to check that the policy is suitable for the consumer.

  2. (2)

    This must be done orally if a firm provides information orally on any main characteristic of a policy.

Price information: general

ICOBS 6.4.6 R RP

A firm must provide price information in a way calculated to enable the customer to relate it to a regular budget.

ICOBS 6.4.7 G RP

Price information is likely also to include at least the total premium (or the basis for calculating it so that the customer can verify it) and, where relevant:

  1. (1)

    for policies of over one year with reviewable premiums, the period for which the quoted premium is valid, and the timing of reviews;

  2. (2)

    other fees, administrative charges and taxes payable by the customer through the firm; and

  3. (3)

    a statement identifying separately the possibility of any taxes not payable through the firm.

ICOBS 6.4.8 G RP

Price information should be given in writing or another durable medium in good time before conclusion of the contract. This is in addition to any requirement or decision to provide the information orally. In the case of a distance contract concluded over the telephone, it may be provided in writing or another durable medium no later than immediately after conclusion.

Price information: premiums paid using a non-revolving credit agreement

ICOBS 6.4.9 R RP
  1. (1)

    This rule applies when a premium will be paid using a credit agreement other than a revolving credit agreement.

  2. (2)

    A firm must provide price information in a way calculated to enable the customer to understand the additional repayments that relate to the purchase of the policy, and the total cost of the policy.

  3. (3)

    Price information must reflect any difference between the duration of the policy and that of the credit agreement.

  4. (4)

    A firm must explain to a customer, as applicable, that the premium will be added to the amount provided under the credit agreement and that interest will be payable on it.

Price information: policies sold in connection with revolving credit arrangements

ICOBS 6.4.10 G RP
  1. (1)

    This guidance applies to policies bought as secondary products to revolving credit agreements (such as store cards or credit cards).

  2. (2)

    Price information should be given in a way calculated to enable a typical customer to understand the typical cumulative cost of taking out the policy. This does not require oral disclosure where there is a sales dialogue with a customer. However, consistent with Principle 7, a firm should ensure that this element of price information is not undermined by any information given orally.

Mid-term changes

ICOBS 6.4.11 R RP
  1. (1)

    Throughout the term of a policy, a firm must provide a customer with information about any change to:

    1. (a)

      the premium, unless the change conforms to a previously disclosed formula; and

    2. (b)

      any term of the policy, together with an explanation of any implications of the change where necessary.

  2. (2)

    This information must be provided in writing or another durable medium in good time before the change takes effect or, if the change is at the customer's request, as soon as is practicable provided the firm explains the implications of the change before it takes effect.

ICOBS 6.4.12 G RP
  1. (1)

    When explaining the implications of a change, a firm should explain any changes to the benefits and significant or unusual exclusions arising from the change.

  2. (2)

    Firms will need to consider whether mid-term changes are compatible with the original policy, in particular whether it reserves the right to vary premiums, charges or other terms. Firms also need to ensure that any terms which reserve the right to make variations are not themselves unfair under the Unfair Terms Regulations (for contracts entered into before 1 October 2015) or the CRA.1

ICOBS 6.5 Renewals

Renewals

ICOBS 6.5.1 R
  1. (1)

    1This section applies when a firm proposes to a consumer the renewal of a general insurance contract, which is not a group policy, and which has a duration of 10 months or more.

  2. (2)

    In this section, ‘renewal’ means carrying forward a policy, at the point of expiry and as a successive or separate operation of the same nature and duration as the policy, with the same insurance intermediary or the same insurer.

  3. (3)

    The firm must provide to the consumer the following information in good time before the renewal:

    1. (a)

      the premium to be paid by the consumer on renewal;

    2. (b)

      in a way that is consistent with the presentation of (a) so that they can be easily compared:

      1. (i)

        except where (ii) applies, the premium for the policy which the firm proposes to renew, as set out at the inception of that policy;

      2. (ii)

        where one or more mid-term changes were made to the policy which the firm proposes to renew, an amount calculated by annualising (or otherwise adjusting as appropriate to the duration of the proposed policy) the premium in effect following the most recent mid-term change, excluding all fees or charges associated with those mid-term changes;

    3. (c)

      a statement alongside (a) and (b) indicating that the consumer:

      1. (i)

        should check that the level of cover offered by the renewal is appropriate for their needs; and

      2. (ii)

        is able, if they so wish, to compare the prices and levels of cover offered by alternative providers4; and

    4. (d)

      a statement informing the consumer whether the contract will automatically renew or whether the consumer needs to take action to accept the renewal offer.

  4. (4)

    Where the proposed renewal will be the fourth or subsequent renewal the consumer has entered into in respect of the policy, the firm must include the following statement, to appear alongside the matters required by (3)(a), (b) and (c)(i) (but omitting (c)(ii)): “You have been with us a number of years. You may be able to get the insurance cover you want at a better price if you shop around.”

  5. (5)

    The firm must communicate the information in (3) and (4):

    1. (a)

      clearly and accurately;

    2. (b)

      in writing or another durable medium; and

    3. (c)

      in a way that is accessible and which draws the consumer’s attention to it as key information.

ICOBS 6.5.1A G
  1. (1)

    23When a firm proposes to a consumer the renewal of a travel insurance policy, the firm should at the same time:

    1. (a)

      disclose to the consumer whether any medical condition exclusion can be removed from the policy (in whole or in part); and

    2. (b)

      if so, how, and the terms on which it can be removed.

  2. (2)

    Firms are reminded of their obligations in:

    1. (a)

      ICOBS 6A.4.5R, where one or more of the circumstances set out in ICOBS 6A.4.6R applies in respect of the policy proposed on renewal; and

    2. (b)

      ICOBS 5.2.2BR to ensure the policy proposed is consistent with the consumer’s insurance demands and needs.

ICOBS 6.5.2 G

1A firm should have regard to the record-keeping obligations referred to in ICOBS 2.4.1G and ensure that it has appropriate systems and controls in place with respect to:

  1. (1)

    the adequacy of its records so it may fulfil its regulatory and statutory obligations; and

  2. (2)

    the sufficiency of its records to enable the FCA to monitor the firm’s compliance with the requirements under the regulatory system.

ICOBS 6.5.3 G

1A firm should ensure it complies with the other requirements in ICOBS that are relevant, such as providing product information to customers (see ICOBS 6.1), including the requirement to provide an IPID (see ICOBS 6.1.10AR).

ICOBS 6.6 1Means of communication

1Means of communication

ICOBS 6.6.1 R R

1The information in ICOBS 6, unless modified in this chapter, must be given in accordance with ICOBS 4.1A (Means of communication to customers).

[Note: article 23(1) of the IDD]

ICOBS 6 Annex 1 Responsibilities of insurers and insurance intermediaries in certain situations

R

This annex belongs to ICOBS 6.-1.4R2

The table in this annex modifies the general rules on the responsibilities of insurers and insurance intermediaries for producing and providing to a customer the information required by this chapter. The table does not include the responsibilities of insurers and intermediaries for producing the IPID (ICOBS 6.-1.5R).2

Situation

Insurance intermediary's responsibility

Insurer's responsibility

(1)

Insurance intermediary operates from UK establishment

Insurer does not operate from UK establishment

Production and providing

None

(2)

Insurance intermediary does not operate from UK establishment, is not authorised, is selling connected contracts or is authorised professional firm carrying on non-mainstream regulated activities

Insurer operates from UK establishment

Customer habitually resident in the United Kingdom3

None

Production and providing (but for pure protection contracts2 no policy summary is required unless the insurance intermediary does not operate from a UK establishment)

(3)

As (2) but customerhabitually resident outside the United Kingdom3 and insurer not in contact with the customer

None

None

(4)

As (2) but customerhabitually resident outside the United Kingdom3 and insurer in contact with the customer

None

Production and providing

(5)

Insurance intermediary does not operate from UK establishment

Insurer does not operate from UK establishment

None

Production and providing

1(6)

Where ICOBS 6.5.1R2 applies

Production and providing, as appropriate, where dealing with a consumer on renewal

Production and providing, as appropriate, where dealing with a consumer on renewal

ICOBS 6 Annex 2 Policy summary (pure protection contracts and / or commercial customers)

This annex belongs to ICOBS 6.1.7AG1 and ICOBS 6.4.4 R

1

Format

1.1

R

(1)

A policy summary must be in writing or another durable medium.

(2)

A policy summary must be in a separate document, or within a prominent separate section of another document clearly identifiable as containing key information that the consumer should read.

1.2

G

The quality and presentation standard of a policy summary should be consistent with that used for other policy documents.

11.3

G

A reference to consumer has the meaning commercial customer if a policy summary is used for the purposes set out in ICOBS 6.1.7AG (appropriate information for commercial customers).

2

Content

2.1

R

A policy summary must contain the information in the table below and no other information.

Policy summary content

• Key facts logo in a prominent position at the top of the policy summary. Further requirements regarding the use of the logo and the location of specimens are set out in GEN 5.1 and GEN 5 Annex 1 G.

• Statement that the policy summary does not contain the full terms of the policy, which can be found in the policy document.

• Name of the insurance undertaking.

• Type of insurance and cover.

• Significant features and benefits.

• Significant or unusual exclusions or limitations, and cross-references to the relevant policy document provisions.

• Duration of the policy.

• A statement, where relevant, that the consumer may need to review and update the cover periodically to ensure it remains adequate.

• Price information (optional).

• Existence and duration of the right of cancellation (other details may be included).

• Contact details for notifying a claim.

• How to complain to the insurance undertaking and that complaints may subsequently be referred to the Financial Ombudsman Service (or other applicable named complaints scheme).

• That, should the insurance undertaking be unable to meet its liabilities, the consumer may be entitled to compensation from the compensation scheme (or other applicable compensation scheme), or that there is no compensation scheme. Information on the extent and level of cover and how further information can be obtained is optional.

2.2

G

A policy summary should properly describe the policy but, in line with Principle 7, should not overload the consumer with detail.

3

Significant or unusual exclusions or limitations

3.1

G

(1)

A significant exclusion or limitation is one that would tend to affect the decision of consumers generally to buy. An unusual exclusion or limitation is one that is not normally found in comparable contracts.

(2)

In determining what exclusions or limitations are significant, a firm should, in particular, consider the exclusions or limitations that relate to the significant features and benefits of a policy and factors which may have an adverse effect on the benefit payable under it.

(3)

Another type of significant limitation might be that the contract only operates through certain means of communication, e.g. telephone or internet.

Examples of significant or unusual exclusions or limitations

• Deferred payment periods

• Exclusion of certain conditions, diseases or pre-existing medical conditions

• Moratorium periods

• Limits on the amounts of cover

• Limits on the period for which benefits will be paid

• Restrictions on eligibility to claim such as age, residence or employment status

• Excesses

4

Key features document as an alternative to a policy summary

4.1

R

A firm may provide a document that has the contents of a key features document instead of a policy summary. The document must include contact details for notifying a claim but need not include the title ‘key features of the [name of product]’.

ICOBS 6 Annex 3 Providing product information by way of a standardised insurance information document:

R

1[Note: the IDD IPID Regulation is 2applicable to IDD insurance intermediaries, IDD insurance undertakings and IDD ancillary insurance intermediaries.]

This annex belongs to ICOBS 6.1.10AR.

1

Effect of provisions marked ‘UK’2

1.1

R

(1)

Provisions in this section marked “UK”2 apply in relation to a firm to which the IDD IPID Regulation3 is not directly applicable, as if they were rules.

(2)

In this annex, a word or phrase found in a provision marked “UK”2 and referred to in column (1) of the table below has the meaning indicated in the corresponding row of column (2) of the table.

(1)

(2)

“Directive (EU) 2016/97”

IDD

“durable medium”

durable medium

“insurance product”

a policy (other than a pure protection contract)

“manufacturer”

manufacturer

“non-life insurance product

a policy (other than a pure protection contract)

”“shall”

must

2

What information needs to be contained in the IPID?

2.1

R

The IPID must contain the following information:

(1)

information about the type of insurance;

(2)

a summary of the insurance cover, including the main risks insured, the insured sum and, where applicable, the geographical scope and summary of excluded risks;

(3)

the means of payment of premium and the duration of payments;

(4)

main exclusions where claims cannot be made;

(5)

obligations at the start of the contract;

(6)

obligations during the term of the contract;

(7)

obligations in the event that a claim is made;

(8)

the term of the contract including the start and end dates of the contract;

(9)

the means of terminating the contract.

[Note: article 20(8) of the IDD]

2.2

G

A firm, when providing the information in the IPID, should consider:

(1)

the rules and guidance on providing appropriate information to customers in ICOBS 6.1;

(2)

the order of the information and priority of the information to be provided; and

(3)

the information needs of the firm’s typical customer for the policy.

2.3

G

A firm that manufactures the policy should, when drawing up the IPID, have regard to the target market and intended distribution strategy.

Name and company logo of the manufacturer

2.4

UK2

1(1)

The name of the manufacturer of the non-life insurance product, 2its regulatory status, and, where relevant, its authorisation number shall immediately follow the title ‘insurance product information document’ at the top of the first page.

2.5

UK2

1(2)

The manufacturer may insert its company logo to the right of the title .

[Note: article 1 of the IDD IPID Regulation]

Reference to complete pre-contractual and contractual information

2.6

UK2

2

The insurance product information document shall state prominently that complete pre-contractual and contractual information about the non-life insurance product is provided to the customer in other documents. That statement shall be placed immediately below the name of the manufacturer of the non-life insurance product.

[Note: article 2 of the IDD IPID Regulation]

3

How must the IPID be presented and formatted?

3.1

R

The IPID must:

(1)

be a short and stand-alone document;

(2)

be presented and laid out in a way that is clear and easy to read, using characters of a readable size;

(3)

be no less comprehensible in the event that, having been originally produced in colour, it is printed or photocopied in black and white;

(4)

be written in the official languages, or in one of the official languages, used in the part of the state2 where the policy is offered or, if agreed by the consumer and the insurance distributor, in another language;

(5)

be accurate and not misleading;

(6)

contain the title ‘insurance product information document’ at the top of the first page;

(7)

include a statement that complete pre-contractual and contractual information on the product is provided in other documents.

[Note: article 20(7)(a) to (g) of the IDD]

Length

3.2

UK2

3

The insurance product information document shall be set out on two sides of A4-sized paper when printed. Exceptionally, if more space is needed, the insurance product information document may be set out on a maximum of three sides of A4-sized paper when printed. Where a manufacturer uses three sides of A4-sized paper, it shall, upon request by the Financial Conduct Authority2, be able to demonstrate that more space was needed.

[Note: article 3 of the IDD IPID Regulation]

Presentation and order of content

3.3

UK2

4(1)

The information of the insurance product information document listed in 2Article 20(8) of Directive (EU) 2016/97 shall be presented in different sections and in accordance with the structure, lay-out, headings and sequence as set out in the standardised presentation format in the Annex to this Regulation, using a font size with an x-height of at least 1,2 mm.

3.4

UK2

4(2)

The length of the sections may vary, depending on the amount of information that is to be included in each section. Information about add-ons and optional covers shall not be preceded by ticks, crosses or exclamation marks.

3.5

UK2

4(3)

Where the insurance product information document is presented using a durable medium other than paper, the size of the components in the layout may be changed, provided that the layout, headings and sequence of the standardised presentation format, as well as the relative prominence and size of the different elements, are retained.

3.6

UK2

4(4)

Where the dimensions of the durable medium other than paper are such that a layout using two columns is not feasible, a presentation using a single column may be used, provided that the sequence of the sections is as follows:

(a)

‘What is this type of insurance?’

(b)

‘What is insured?’

(c)

‘What is not insured?’

(d)

‘Are there any restrictions on cover?’

(e)

‘Where am I covered?’

(f)

‘What are my obligations?’

(g)

‘When and how do I pay?’

(h)

‘When does the cover start and end?’

(j)

‘How do I cancel the contract?’.

3.7

UK2

4(5)

The use of digital tools, including layering and pop-ups shall be permitted, provided that all the information referred to in Article 20(8) of Directive (EU) 2016/97 is provided in the main body of the insurance product information document and that the use of such tools does not distract the customer’s attention from the content of the main document.

Information provided through layering and pop-ups

shall not include marketing or advertising material.

[Note: article 4 of the IDD IPID Regulation ]

Plain language

3.8

UK2

5

The insurance product information document shall be drafted in plain language, facilitating the customer’s understanding of the content of that document, and shall focus on key information which the customer needs to make an informed decision. Jargon shall be avoided.

[Note: article 5 of the IDD IPID Regulation]

Headings and information thereunder

3.9

UK2

6(1)

The sections of the insurance product information document shall have the following headings and the following information thereunder:

(a)

the information on the type of insurance referred to in Article 20(8)(a) of Directive (EU) 2016/97 shall be included under the heading ‘What is this type of insurance?’, at the top of the document;

(b)

the information on the main risks insured referred to in Article 20(8)(b) of Directive (EU) 2016/97 shall be included under the heading ‘What is insured?’. Each piece of information listed in this section shall be preceded by a green ‘tick’ symbol;

(c)

the information on the insured sum referred to in Article 20(8)(b) of Directive (EU) 2016/97 shall be included under the heading ‘What is insured?’;

(d)

the information on geographical scope, where applicable, referred to in Article 20(8)(b) of Directive (EU) 2016/97 shall be included under the heading ‘Where am I covered?’. Each piece of information listed in this section shall be preceded by a blue ‘tick’ symbol;

(e)

the information on a summary of the excluded risks referred to in Article 20(8)(b) of Directive (EU) 2016/97 shall be included under the heading ‘What is not insured?’. Each piece of information in this section shall be preceded by a red ‘X’ symbol;

(f)

the information on the main exclusions referred to in Article 20(8)(d) of Directive (EU) 2016/97 shall be included under the heading ‘Are there any restrictions on cover?’. Each piece of information listed in this section shall be preceded by an orange exclamation mark symbol;

(g)

the information on the relevant obligations referred to in points (e), (f) and (g) of Article 20(8) of Directive (EU) 2016/97 shall be included under the heading ‘What are my obligations?’;

(h)

the information on the means and duration of payment of premiums referred to in Article 20(8)(c) of Directive (EU) 2016/97 shall be included under the heading ‘When and how do I pay?’;

(i)

the information on the term of the contract referred to in Article 20(8)(h) of Directive (EU) 2016/97 shall be included under the heading ‘When does the cover start and end?’;

(j)

the information on the means of terminating the contract referred to in Article 20(8)(i) of Directive (EU) 2016/97 shall be included under the heading ‘How do I cancel the contract?’.

6(2)

The use of sub-headings is permitted, where necessary.

[Note: article 6 of the IDD IPID Regulation]

Use of icons

3.10

UK2

7(1)

Each section shall further be headed by icons that visually represent the content of the respective section heading, as follows:

(a)

the information on the main risks insured referred to in Article 20(8)(b) of Directive (EU) 2016/97 shall be headed by an icon of an umbrella, which shall be white on a green background or green on a white background;

(b)

the information on the geographical scope of the insurance cover referred to in Article 20(8)(b) of Directive (EU) 2016/97 shall be headed by an icon of a globe, which shall be white on a blue background or blue on a white background;

(c)

the information on excluded risks referred to in Article 20(8)(b) of Directive (EU) 2016/97 shall be headed by an icon of an X symbol within a triangle, which shall be white on a red background or red on a white background;

(d)

the information on the main exclusions referred to in Article 20(8)(d) of Directive (EU) 2016/97 shall be headed by an exclamation mark (‘!’) within a triangle, which shall be white on an orange background or orange on a white background;

(e)

the information on the obligations at the start of the contract, during the term of the contract and in the event that a claim is made, referred to in points (e), (f) and (g) of 20(8) of Directive (EU) 2016/97, respectively, shall be headed by an icon of a handshake, which shall be white on a green background or green on a white background;

(f)

the information on the means and duration of payments referred to in Article 20(8)(c) of Directive (EU) 2016/97 shall be headed by an icon of coins, which shall be white on a yellow background or yellow on a white background;

(g)

the information on the term of the contract referred to in Article 20(8)(h) of Directive (EU) 2016/97 shall be headed by an icon of an hourglass, which shall be white on a blue background or blue on a white background;

(h)

the information on the means of terminating the contract referred to in Article 20(8)(i) of Directive (EU) 2016/97 shall be headed by an icon of a hand with an open palm on a shield, which shall be white on a black background, or black on a white background.

3.11

UK2

7(2)

All icons shall be displayed in a manner consistent with the standardised presentation format in the Annex.

3.12

UK2

7(3)

The icons referred to in paragraphs 1 and 2 may be presented in black and white where the insurance product information document is printed or photocopied in black and white.

[Note: article 7 of the IDD IPID Regulation]

Template for the standardised presentation format

3.13

EU

ANNEX

ICOBS_06_ann_03

[Note: Annex to the IDD IPID Regulation]