FCA · Post-Consumer Duty

FCA post-Consumer Duty consultation 2027 — PII

Reviewed by Matthew Bartlett, Director, Apex Insurance Brokers Limited · Published 15 July 2026

The FCA is consulting in 2026-2027 on refinements to the Consumer Duty (PRIN 2A) framework, drawing on lessons from year-one and year-two implementation. PII implications are material for regulated firms.

What the consultation covers

Fair-value assessment refinements — year-one/two lessons.

Vulnerable-customer protections — enhancing FG21/1 implementation.

Distribution-chain accountability — particularly for wholesale intermediary firms.

Consumer understanding standards — documentation and evidence expectations.

PII-relevant claim patterns emerging from Consumer Duty.

PII-specific implications

FOS award threshold — currently £430k, whether it rises given inflation.
Consumer-vs-commercial classification — harder-edged distinctions.
Aggregation clause treatment for Consumer Duty claims — industry alignment.
Product-manufacturer vs distributor obligations — who's responsible for what.
AR firm principal-level responsibility for Consumer Duty compliance.

Firms most affected

IFAs — direct consumer-facing advice.
Insurance brokers — particularly on personal lines.
Consumer credit firms.
Mortgage advisers.
Pension advisers.
Investment platforms and wealth managers.

What the consultation may recommend

Simplified documentation standards for smaller firms.

Clearer fair-value assessment templates.

Enhanced vulnerable-customer protections.

Refinement of consumer-vs-commercial classification.

Ongoing monitoring and reporting requirements.

How firms should engage

Respond to consultation via FCA portal.
Coordinate with sector bodies (PIMFA, Association of British Insurers).
Document your Consumer Duty implementation for evidence in response.
Broker involvement to link PI implications to Consumer Duty response.

Frequently asked

Will the FOS threshold rise?

Under review. Historical increases in line with inflation suggest a rise likely, though timing unclear.

How does this affect small firms?

The consultation considers proportionality — small firms may see simplified documentation expectations.

Do AR firms get separate treatment?

The consultation considers AR-principal responsibility explicitly — some clarification expected.

What about wholesale firms?

Distribution-chain responsibilities are under review. Firms in the middle of the chain need clarity.

How does PII adjust?

Insurers price Consumer Duty-affected claims into premiums. Documentation quality matters more than in the past.

When effective?

Depends on specific rule changes. Most refinements likely effective 2027-2028.

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Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Firm reference number 724952. Registered in England and Wales, company number 07014570.