WHAT’S ON THE RADAR?
The CII takes a look at what’s new on the policy and public affairs front this month
AI TO TACKLE FRAUD AND ASSESS FLOOD DAMAGE
A project led by the Department for Business, Energy & Industrial Strategy to develop breakthrough artificial intelligence (AI) technology for the anti-fraud sector, is one of a number of new projects set to receive funding to enable the UK insurance, accountancy and legal services industry to transform how they operate.
The AI software will combine AI and voice-recognition technology to detect and interpret emotion and linguistics to assess the credibility of insurance claims. Insurance fraud cost the UK £3bn in 2017, equating to £10,400 per fraudulent claim, and costing consumers an extra £50 per policy.
The project is one of 40 backed by £13m in government investment to support collaborative industry and research projects, to develop the next generation of professional services.
For more information, visit: bit.ly/2UZKGEE
CMA TACKLES LOYALTY PENALTY CHARGES
The Competition and Markets Authority (CMA) has investigated concerns raised by Citizens Advice in a ‘super-complaint’, that companies penalise existing customers by charging them higher prices than those who are new.
The CMA has looked at the five markets highlighted by the super-complaint – including household insurance – and found that vulnerable people, including the elderly and those on a low income, may be more at risk of paying the loyalty penalty.
With reference to home insurance, the regulator points to evidence suggesting that many longstanding customers are paying much more than newer customers, with businesses repeatedly increasing prices year on year. It welcomes the Financial Conduct Authority’s (FCA) current general insurance market study (which can be viewed at bit.ly/2QSGzvK) and recommends that it:
- Investigates insurance pricing practices and consider pricing interventions that limit successive prices rises (‘price walking’).
- Explore how intermediaries can continue to benefit the home insurance market (for example where ‘semi-smart’ solutions can improve the existing infrastructure of price comparison websites). For further details of the CMA’s super-complaint investigation, visit: bit.ly/2GxtXoN
TREASURY SELECT COMMITTEE
post-Brexit inquiry The Treasury Select Committee has launched an inquiry into the government’s financial services priorities when it negotiates the UK’s future trading relationship with the EU and third countries post-Brexit.
Additionally, the committee will consider whether the current regulatory barriers in the UK that apply to trade with third countries should remain, and how the UK’s financial services sector can take advantage of the UK’s new trading environment.
The webpage can be viewed at: bit.ly/2SIYuXk
FCA SPEECH ON DIVERSITY
Chris Woolard, executive director of strategy and competition at the FCA, has delivered a speech on diversity in financial services, in which he drew attention to how the debate has moved on to build a consensus around the commercial imperative of diversity for firms, rather than it being just a ‘nice to have’.
FCA statistics demonstrate that the percentage of women in senior management below board level has increased by only 1.5% during the past 10 years. Mr Woolard continued to say that the regulator can deduce much about a firm’s culture by how it approaches diversity and inclusion.
The regulator’s final message to firms is clear: non-financial misconduct is misconduct, plain and simple.
The full speech can be viewed at: bit.ly/2EFR8MF
Director of strategy and competition at the FCA, Christopher Woolard, outlined some of the challenges in the long-term savings market
The International Regulatory Strategy Group (IRSG) has published a report which calls for a review of the UK’s rulemaking system for financial services post-Brexit.
The EU General Data Protection Regulation (GDPR) will apply in the UK from 25 May 2018. It is an essential step forward in enhancing the privacy and security of personal data.