Category: Compliance & AML · Reviewed by Amy Price, Account Executive · Last reviewed June 2026
The FCA’s framework for assessing whether an individual is fit and proper to perform a controlled function or certification function — covering honesty and integrity, competence and capability, and financial soundness.
The Fit and Proper test (FIT) is a sourcebook in the FCA Handbook that sets out the three pillars used to assess an individual’s fitness and propriety. It is the operative standard for approval of Senior Managers, for annual certification of certified staff, and for the regulatory reference exchange between firms.
FSMA section 60A (assessment of fitness and propriety). FIT (the sourcebook) gives detailed criteria. SYSC 22 governs the regulatory references regime that supports FIT assessment.
FIT 2.1 covers honesty, integrity and reputation — looking at criminal convictions, civil judgments, disciplinary findings, regulatory breaches, dishonesty allegations, sanctions list checks, adverse media and integrity referees. FIT 2.2 covers competence and capability — qualifications, training, experience, technical knowledge and continuing professional development. FIT 2.3 covers financial soundness — bankruptcy, IVAs, county court judgments, financial distress. Assessment is not a one-off event but a continuing duty.
For firms within the IDD scope, Article 10(2) of IDD requires distributors to demonstrate appropriate knowledge and ability, with a minimum 15 hours of professional training and development a year — typically discharged through CII or CILA CPD logs in the UK general insurance market.
At Apex, fitness and propriety checks at recruitment include criminal record disclosure (basic DBS), credit reference search, identity verification, qualification verification, employment reference receipt under SYSC 22, sanctions screening and adverse media check. Annual recertification repeats key checks and incorporates the year’s performance and complaint record.
FCA Handbook, Fit and Proper test for Approved Persons and Specified Significant-Harm Functions (FIT). Financial Services and Markets Act 2000, section 60A. UK retained Insurance Distribution Directive (Directive (EU) 2016/97), Article 10.
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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