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Aipedia: Financial advisers
Targeted support and robo-advice let firms serve many clients through automated or digital journeys, but the firm remains liable for each journey's design and outcomes. For PI, the key question is whether the policy covers non-advised and automated services, not just personal recommendations.
Part of: AI in Financial advisers
In short
The targeted support regime took effect on 6 April 2026. It lets authorised firms with a new permission give suggestions to groups of customers with common characteristics on pensions and retail investments, and firms are building it as scaled, often digital, journeys. Robo-advice platforms give automated personal recommendations. In both, one design flaw can repeat across thousands of customers. The Consumer Duty, SM&CR and, for personal recommendations, COBS 9 still apply. Many adviser PI wordings are written around personal advice, so check that targeted support and automated services fall within the insured activities.
Firms are using automation in three broad ways. Robo-advice platforms collect information online and generate a personal recommendation with little or no adviser involvement. Hybrid models use automation for the fact-find, risk profiling and portfolio selection, with an adviser reviewing the output. And from 6 April 2026, firms with the new permission can offer targeted support: suggestions aimed at groups of customers who share common characteristics, such as a pension saver in a default fund or someone considering drawdown.
AI increasingly sits inside these journeys, segmenting customers, choosing which message to show, and answering questions through chat. The Mills Review notes AI could help address the advice gap but also increase fraud and consumer harm risk.
The targeted support regime was confirmed in PS25/22 on 11 December 2025 and by the FCA Board on 26 February 2026. Targeted support is distinct from holistic personal advice: it gives suggestions for groups of customers rather than a personal recommendation based on a full assessment of an individual. The FCA and ICO have also issued a joint statement on communicating targeted support to customers.
The risk is drift. A journey designed as targeted support can, through AI-personalised wording or chatbot follow-ups, start to look like a personal recommendation. If it does, COBS 9 suitability duties may be engaged, with a much higher standard to meet. See client chatbots on adviser websites.
Automated journeys fail at scale. A segmentation rule that places customers in the wrong group, an outdated assumption in the suggestion logic or a chatbot that goes beyond the script can affect every customer who passes through.
Illustrative scenario: a firm launches a targeted support journey for pension savers approaching retirement. An AI personalisation layer tailors the wording to each customer's answers, and some customers read the result as a recommendation to move to drawdown. Months later the firm finds that customers with small pots and other debts were routed the same way. It faces a review of every customer in the segment.
PI usually covers the professional services described in the schedule. Many adviser wordings were written around personal advice, and some may not clearly cover targeted support, guidance or automated services. Check that the business description and insured activities include the new permission and any robo or hybrid service. Because errors repeat across customers, aggregation wording matters. The Financial Ombudsman Service has said that advice from unregulated individuals, firms or AI platforms is outside its remit, but complaints about a regulated firm's automated service are within it. See Does adviser PI cover AI mistakes? and the IFA PI insurance guide.
Apex arranges PI for financial advisers. A broker can review your cover and how your policy treats AI-assisted work, including whether targeted support and automated services are within the insured activities. See AI in financial advice and FCA AI guidance explained.
No. Targeted support lets authorised firms with the new permission give suggestions to groups of customers with common characteristics, rather than a personal recommendation based on a full assessment of an individual. It took effect on 6 April 2026.
It depends on how the policy describes your business and insured activities. Many wordings were written around personal advice. Tell your insurer before launching a targeted support or automated service and ask for written confirmation that it is covered.
The firm. COBS 9.2.1R applies to personal recommendations however they are produced, and SYSC 8.1.6R keeps the firm fully responsible for outsourced functions. The FCA's October 2026 page says firms using AI remain responsible for consumer outcomes.
Yes, if the service is provided by a regulated firm and the complaint is within its jurisdiction. The Financial Ombudsman Service has said that advice from unregulated individuals, firms or AI platforms is outside its remit.
Tell us about your firm and the work you do. A broker will review how your current PI treats AI-assisted work, or arrange new cover. No fee for a quote. Or call 0117 325 0027.
Start a PI quote Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information about how AI is used in the profession and how insurance may respond. It is not legal, regulatory or insurance advice on your circumstances, and it does not guarantee that cover will be available or on what terms.
