2. CHAPTER 10 CONSUMER PROTECTION
9% OF THE EXAM

3. General Data Protection Regulations (GDPR)
Does it protect…
Public data 
Corporate data 
Personal data 
All of the above 
Information Commissioner ?
Data Controller
Data Subject
Data Processor

4. General Data Protection Regulations (GDPR)
processed lawfully, fairly and in a transparent manner
collected for specified, explicit and legitimate purpose
adequate, relevant and limited to what is necessary
accurate and, where necessary, kept up to date
kept for no longer than is necessary
processed in a manner that ensures appropriate security

5. General Data Protection Regulations (GDPR)
Data subjects rights:
The right to be informed.
The right of access.
The right to rectification.
The right to erasure.
The right to restrict processing.
The right to data portability.
The right to object.
Rights in relation to automated decision making and profiling.

6. Data Protection Bill (DP Bill)
Under GDPR different member states are allowed to make limited provisions on how GDPR is applied in their country.
The UK has passed the Data Protection Bill to modernise the data protection rules in the UK and will need to be looked at in conjunction with the GDPR.
Provide clarity on definitions used in GDPR in a UK context.
Set the parental consent age to children under 13.
Allow the information commissioner to levy fines up to a maximum of £17m - €20m – 4% global turnover (whichever is greatest)

7. ETHICAL STANDARDS AND CODES OF CONDUCT
Ethics relate to morality
Morality therefore relates to an individuals attitudes and behaviours
CII Code of Ethics:
This code should not be seen as yet another regulatory burden but rather as a virtuous platform for improving the reputation of CII members as a whole and in distinguishing our membership in comparison with less qualified and regulated competitors. Beyond this, adoption of and adherence to the code can help promote standards and public trust.

8. ETHICAL STANDARDS AND CODES OF CONDUCT
Ethical behaviours…
INTEGRITY
FAIRNESS
SERVICE
CLIENTS INTEREST
COMPLIANCE

9. ETHICAL STANDARDS AND CODES OF CONDUCT
5 central principles in the cii code of ethics:
Comply with the code and all relevant laws and regulations
Act with the highest ethical standards and integrity
Act in the best interests of each client
Provide a high standard of service
Treat people fairly, regardless of, race or racial group, sex or sexual orientation, religion or belief, age and disability, marriage and civil partnership, pregnancy and maternity and gender reassignment.

10. ETHICAL STANDARDS AND CODES OF CONDUCT
Compliance with the code, relevant laws and regulation:
Must act in an open, co-operative and courteous manner.
Members must abide by the spirit and letter of the law.
Example:
You are an intermediary. Your internal compliance procedures state that the renewal process for a client should begin one month prior to renewal. You are aware that a particular client will be on holiday for a significant part of the period immediately prior to renewal and that there is likely to be a need to consider other insurers terms because of the poor claims experience during the current policy period.

11. ETHICAL STANDARDS AND CODES OF CONDUCT
Highest ethical standards and integrity
Honesty, trustworthiness and reliability.
Avoid taking unfair advantage of clients, colleagues or third parties.
Example:
You work for an insurance company. You have an expense account that permits you to entertain intermediaries that are likely to generate new business flows. There is a stated limit for any one meal / event. A particular intermediary shows encouraging signs of being willing to consider placing business with you having not been a supporter of yours in the past.

12. ETHICAL STANDARDS AND CODES OF CONDUCT
The best interest of each client
Honesty, truthfulness and objectivity.
Example:
You are an intermediary that has arranged separate private motor insurances for two different clients. As part of your service you have agreed to attempt to recover for each client their uninsured losses (costs of car hire, out of pocket expenses etc.) following a non-fault motor accident. There is a car collision involving both your clients and each maintain that it is the fault of the other.

13. ETHICAL STANDARDS AND CODES OF CONDUCT
High standard of service
Transparency and suitability
Example:
You work for an insurance company. An analysis of recent complaints from customers shows that the team for which you are responsible are receiving an increasing number of complaints from customer relating to claims that the customers expected to be covered under their policies, but were excluded. The timing coincides with the introduction of a rewritten series of scripted answers for the provision of information about cover (provided at point of sale). Its introduction reduced the average time for each sale significantly.

14. ETHICAL STANDARDS AND CODES OF CONDUCT
Treating people fairly (non-discrimination)
Avoidance of unfair discrimination on grounds of race, gender, sexual orientation, religion, age or disability.
Example:
You work for an insurance company that has a practice of offering travel insurance for those up to 70 years of age. You have been challenged about this practice by someone who is 74 years of age arguing that they are fitter than most 65 years old.

15. TRAINING AND COMPETENCE
A firm must ensure that they:
Employ personnel with the skill, knowledge and expertise necessary for the responsibilities allocated to them.
Take into account the nature, scale and complexity of its business.

16. TRAINING AND COMPETENCE
The FCA expects that:
A firms employees are competent
Employees remain competent
Employees are appropriately supervised
Employees’ competence is regularly reviewed
The level of competence is appropriate for their role
Competence relates to:
Technical knowledge
Skills and expertise
Market/product changes

17. TRAINING AND COMPETENCE
TRAINING RECORDS
NON-MIFID
General Insurance Companies
3 Years
MIFID
Investment firms
5 Years

18. COMPLAINTS PROCEDURES
Definition of a complaint:
Any oral or written expression of dissatisfaction, whether justified or not, from a person about the failure of a financial service.
FCA Categories of complainants
Eligible
Non-eligible

19. COMPLAINTS PROCEDURES
Definition of an eligible complainant:
Consumer
A micro-enterprise which employs fewer than 10 persons and has a turnover of annual balance sheet that does not exceed 2 million euro
A charity with an annual income of less than £1 million
A trust with a net asset value of less than £1 million

20. COMPLAINTS PROCESSING
Complaints records must be kept for at least 3 years.
The files must contain the following:
The name of the person dealing with the complaint.
The name of the complainant.
The capacity (eligible or non-eligible)
The substance of the claim
Corresponding file notes
Any redress offered

21. FINANCIAL OMBUDSMAN SERVICE
Membership is compulsory for insurers and authorised firms
Independent organisation that handle disputes between company and customer
Eligible complainants have 6 months to go to the FOS once the complaint is closed
The ombudsman's decision is binding on the insurer,
but not the complainant
Maximum award is £150,000
Funded by levy’s on all authorised firms

22. FINANCIAL SERVICES COMPENSATION SCHEME COMPULSORY INSURANCES
The FSCS is a one stop compensation shop that provides compensation to customers of authorised insurers and intermediaries.
Covers claims against firms that are unable, or likely to be unable to pay claims against them.
Funded by levy’s on all firms that use them.
COMPULSORY INSURANCES
ALL OTHER INSURANCES
100% COMPENSATION
90% COMPENSATION