Consultation: Guidance for firms on the fair treatment of vulnerable customers


The Financial Conduct Authority (FCA) has set-out its vision for a market that works for consumers. In particular, it wants to make sure that financial service companies, including group insurers, treat the end users of their services fairly.

The FCA’s Principles require financial service companies to ensure vulnerable customers are consistently and fairly treated. “The FCA wants to see doing the right thing for vulnerable consumers deeply embedded in firms’ culture.”

Vulnerable consumers include anyone who is susceptible to detriment, which the FCA argues is up to 50% of people. Drivers of potential vulnerability, include: health – health conditions or illnesses that affect the ability to carry out day-to-day tasks; resilience – low ability to withstand financial or emotional shocks; life events – major life events such as bereavement or relationship breakdown; and capability – low knowledge of financial matters.

The guidance is relevant to all firms involved in the supply of products or services to retail customers even if they do not have a direct client relationship with the customers.

Although this consultation does not directly affect employers, in terms of how staff should be treated if they need to make a claim under a group insurance policy, this is certainly of interest.

The FCA is looking for feedback on this guidance by 4 October 2019.