Category: Compliance & AML · Reviewed by Tim Roche, Director · PI & Commercial · Last reviewed June 2026
The structured assessment, required under the Consumer Duty price and value outcome and ICOBS 6A POG rules, that a product or service provides fair value to retail customers — comparing benefits to the price paid across the customer journey.
A fair value assessment is the analytical exercise that an in-scope firm conducts to determine whether the price the retail customer pays is reasonable relative to the overall benefits they receive. Manufacturers undertake the assessment at the product / target market level. Distributors assess the value they add and ensure the manufacturer’s assessment remains valid within their distribution model.
FCA Handbook, PRIN 2A.4 (Consumer Duty price and value outcome) and ICOBS 6A.2–6A.4 (POG-related fair value requirements). FCA Policy Statement PS21/5 (General insurance pricing practices) introduced the price-walking remedies and the explicit annual fair value assessment for insurance products.
The assessment considers the benefits to the customer (cover, service, claims experience), the price (premium, fees, commissions, finance costs, ancillary charges), the costs the firm incurs in delivering the product, and the distribution chain economics. For an insurance product the assessment looks at things like claims ratio, expense ratio, complaints rate, claims acceptance rate, and ancillary income (e.g. cancellation fees, premium finance APR margin). The assessment is documented, supports an explicit fair-value statement, and is updated at least annually.
Manufacturers must provide value assessment information to distributors so that distributors can confirm and supplement the manufacturer’s view. For commercial products outside the Consumer Duty retail scope, the equivalent ICOBS POG fair-value duty still applies under ICOBS 6A.
Apex receives manufacturer fair value statements for each in-scope product, reviews them against the firm’s own data (customer outcome MI, complaint rates, claims experience), considers the distributor’s own value add (broker fee, advice, service), and concludes the value position. Concerns are escalated to the manufacturer; persistent fair-value issues result in product withdrawal from Apex’s distribution.
FCA Handbook, PRIN 2A.4 and ICOBS 6A. FCA Policy Statement PS21/5 (General insurance pricing practices). FCA Policy Statement PS22/9 (Consumer Duty).
By Matt Bartlett, Director, on 2026-06-11.
This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-11. Apex Insurance Brokers Limited, FCA FRN 724952, Companies House 07014570. Not regulated advice — consult your broker on your specific position.
Apex Insurance Brokers serves UK professional services firms and commercial businesses. Call 0117 325 0027, email hello@apexinsurancebrokers.co.uk, or request a quotation.
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