This chapter4 applies to an insurance intermediary and to an insurer carrying on insurance distribution activities4.

In good time before4 the conclusion of an initial contract of insurance and, if necessary, on its amendment or renewal :4

1. (1)

   a firm must provide the customer with at least the following information:4

   1. (a)

      its identity, address and whether it is an insurance intermediary or an insurance undertaking;4

   2. (b)

      whether it provides a personal recommendation about the insurance products offered;4

   3. (c)

      the procedures allowing customers and other interested parties to register complaints about the firm with the firm and the Financial Ombudsman Service or, if the Financial Ombudsman Service does not apply, information about the out-of-court complaint and redress procedures available for the settlement of disputes between the firm and its customers; and4

2. (2)

   an insurance intermediary must also provide the customer with the following information:4

   1. (a)

      the fact that it is included in the Financial Services Register (or if it is not on the Financial Services Register, the register in which it has been included) and the means for verifying this;4

   2. (b)

      whether it has a direct or indirect holding representing 10% or more of the voting rights or capital in a given insurance undertaking (that is not a pure reinsurer); 4

   3. (c)

      whether a given insurance undertaking (that is not a pure reinsurer) or its parent undertaking has a direct or indirect holding representing 10% or more of the voting rights or capital in the firm; and4

   4. (d)

      whether it is representing the customer or is acting for and on behalf of the insurer; and4

   [Note: articles 18 and 19(1)(a) and (b) of the IDD4]

3. (3)

   paragraph (2) does not apply in relation to a connected travel insurance contract.

A firm whose contact with a customer is limited to effecting introductions (see PERG 5.6) need only provide its identity,4 address and whether it is a member of the same group as the firm to which it makes the introduction.

1. (1)

   Where an insurance intermediary proposes or advises on a contract of insurance then in good time before4 the conclusion of an initial contract of insurance (other than a connected travel insurance contract) and, if necessary, on its amendment or renewal an insurance intermediary4 must provide the customer with at least information on whether the firm4:

   2
   1. (a)

      gives a personal recommendation4, on the basis of a fair and personal4 analysis; or

   2. (b)

      is under a contractual obligation to conduct insurance distribution4exclusively with one or more insurance undertakings, in which case it must provide the names of those insurance undertakings4; or

   3. (c)
      1. (i)

         is not under a contractual obligation to conduct insurance distribution exclusively with one or more insurance undertakings; and4

      2. (ii)

         does not give a personal recommendation on the basis of a fair and personal analysis;4

      in which case it must provide its customer with the name of those insurance undertakings with which the insurance intermediary may and does conduct business.4

2. (2)

   [deleted]4

   33

Where the firm has given information in ICOBS 4.1.6R(1)(b) and (c), then in good time before the4 conclusion of an initial contract of insurance with a consumer a firm must also4 state whether it is giving:4

1. (1)

   a personal recommendation but not on the basis of a fair and personal analysis;4

2. (2)

   other advice on the basis of a fair analysis of the market;4

3. (3)

   other advice not on the basis of a fair analysis of the market; or4

4. (4)

   just information.4

1This section applies to all information required to be provided to a customer in this chapter and in other chapters or sections where stated.

1. (1)

   1A firm must communicate information to a customer using any of the following:

   1. (a)

      paper; or

   2. (b)

      a durable medium other than paper; or

   3. (c)

      a website (where it does not constitute a durable medium) where the website conditions are satisfied.

2. (2)

   The firm must communicate the information in (1):

   1. (a)

      in a clear and accurate manner, comprehensible to the customer;

   2. (b)

      in an official language of the State of the risk or in any other language agreed by the parties; and

   3. (c)

      free of charge.

   [Note: article 23(1), (2), (4) and (5) of the IDD]

1Where the information is communicated using a durable medium other than paper or by means of a website, the firm must, upon request and free of charge, also send the customer a paper copy.

[Note: article 23(3) of the IDD]

1A firm must ensure that a customer’s choice or consent to receive the information by means of a website (whether a durable medium or where the website conditions are satisfied) is an active and informed choice or consent.

1On renewal of a policy a firm may rely on a customer’s previous choice or consent as appropriate where:

1. (1)

   there is evidence that the customer has regular access to the internet;

2. (2)

   the provision of information in that medium is appropriate in the context in which the business between the firm and the customer is carried on; and

3. (3)

   the customer is made aware, for example in the renewal documentation, of the option to receive the information on paper in a way that is clear, fair and not misleading.

1In the case of telephone selling:

1. (1)

   the information must be given in accordance with the distance marketing disclosure rules (see ICOBS 3.1.14R); and

2. (2)

   if prior to the conclusion of the contract the information is provided:

   1. (a)

      orally; or

   2. (b)

      on a durable medium other than paper;

   the firm must also provide the information to the customer in accordance with ICOBS 4.1A.2R immediately after the conclusion of the contract of insurance.

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

This section applies in relation to a pure protection contract or a payment protection contract for a consumer.

1. (1)

   In a sale that does not involve a personal recommendation, a firm must take reasonable steps to ensure a customer (C) understands that C is2 responsible for deciding whether a policy meets C’s2 demands and needs.

2. (2)

   [deleted]2

3. (3)

   If a firm anticipates providing, or provides, information on any main characteristic of a policy orally during a non-advised sale, taking reasonable steps includes explaining the customer's responsibility orally.

4. (4)

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

1. (1)

   Prior to the conclusion of an initial contract and, if necessary, on its amendment or renewal, an insurer must disclose to the customer at least:

   1. (a)

      the statutory status disclosure statement (see GEN 4);

   2. (b)

      whose policies it offers; and

   3. (c)

      whether it is providing a personal recommendation or information.

2. (2)

   [deleted]2

1In good time before the conclusion of the initial contract of insurance and, if necessary, on its amendment or renewal an insurance intermediary must provide the customer with information:

1. (1)

   on the nature of the remuneration received in relation to the contract of insurance:

2. (2)

   about whether in relation to the contract it works on the basis of:

   1. (a)

      a fee, that is remuneration paid directly by the customer; or

   2. (b)

      a commission of any kind, that is the remuneration included in the premium; or

   3. (c)

      any other type of remuneration, including an economic benefit of any kind offered or given in connection with the contract; or

   4. (d)

      on the basis of a combination of any type of remuneration set out above in (a), (b) and (c).

[Note: article 19(1)(d) and (e) of the IDD]

1In good time before the conclusion of a contract of insurance, an insurance undertaking must provide its customer with information on the nature of the remuneration received by its employees in relation to the contract of insurance.

[Note: article 19(4) of the IDD]

1The remuneration referred to in this section includes remuneration that is not guaranteed or which is contingent on meeting certain targets.

1If any payments, other than ongoing premiums and scheduled payments, are made by the customer under the contract of insurance after its conclusion, a firm must make the disclosures under this section, for each such payment.

[Note: articles 19(3) and (5) of the IDD]

1. (1)

   Where a fee is payable, the firm must inform1 its customer of the amount of the fee1.

2. (2)

   The information in (1)1 must be given before the customer incurs liability to pay the fee, or before conclusion of the contract of insurance1, whichever is earlier.

3. (3)

   To the extent that it is not possible for an amount to1 be given, a firm must give the basis for its1 calculation.

[Note: articles 19(2) and (5) of the IDD]1

1The fee disclosure requirement extends to all such fees that may be charged during the life of a policy.

[Note: article 19(3) of the IDD]

1. (1)

   An insurance intermediary must, on a commercial customer's request, promptly disclose the commission that it and any associate receives in connection with a policy.

2. (2)

   Disclosure must be in cash terms (estimated, if necessary) and in writing or another durable medium. To the extent this is not possible, the firm must give the basis for calculation.

A firm which agrees an adviser charge with a consumer and provides an associated pure protection service to that consumer must:

1. (1)

   in good time before the provision of its services, take reasonable steps to ensure that the consumer understands:

   1. (a)

      how the firm is remunerated for its pure protection service; and

   2. (b)

      if applicable, that the firm will receive commission in relation to its pure protection service in addition to the firm'sadviser charge;

2. (2)

   as close as practicable to the time that it makes the personal recommendation or arranges the sale of the pure protection contract, comply with the following disclosure requirements, substituting pure protection contract for references to packaged product:

   1. (a)

      COBS 6.4.3 R, or COBS 6.4.4A R and COBS 6.4.4B R; and

   2. (b)

      COBS 6.4.5 R.

If a firm expects to provide, or provides, information about its adviser charge orally, it must also provide the information required by ICOBS 4.6.2R (1)(a) and ICOBS 4.6.2R (1)(b) orally.