Category: Compliance & AML · Reviewed by Chrissie Anderson, Client Executive · Last reviewed June 2026
The ICOBS chapter setting standards for how insurers and intermediaries handle insurance claims — including the duty to handle promptly and fairly, the rules on third-party claim handling, and the specific consumer-protection requirements.
ICOBS 8 sets the conduct-of-business rules for claims handling. It requires insurers (and, where applicable, intermediaries acting under delegated authority) to handle claims promptly and fairly, to provide reasonable guidance, and not to unreasonably reject a claim. It also addresses the specific position of third-party claims under the Third Parties (Rights against Insurers) Act 2010.
FCA Handbook, ICOBS 8. Made under FSMA sections 137A and 138, implementing UK retained IDD Article 17 (fair treatment) as it applies to claims. Substantive law on third-party claims sits in the Third Parties (Rights against Insurers) Act 2010 and Insurance Act 2015.
ICOBS 8.1.1R requires firms to act promptly and fairly at every stage. ICOBS 8.1.2R prohibits unreasonable rejection or repudiation. The Insurance Act 2015 reformed the duty of fair presentation (replacing the prior “utmost good faith” basis for commercial customers) and limited insurers’ rights to avoid contracts for non-deliberate or non-reckless misrepresentation. For intermediaries handling claims under delegated authority, the rules apply with full force.
Direct-claims insurers handle claims in-house. Intermediaries with claims-handling delegation under TOBAs operate to ICOBS 8 and to specific service-level agreements with insurers. Lloyd’s claims handling is governed by additional byelaws and minimum standards. The Insurance Act 2015 changes apply to non-consumer contracts; for consumer insurance the Consumer Insurance (Disclosure and Representations) Act 2012 already applied a reformed regime.
A customer’s domestic property claim is acknowledged within two business days, a loss adjuster is appointed within five, and a settlement decision is communicated within 30 days of receipt of the necessary evidence. If the insurer disputes part of the claim, the reason is given in writing, supported by reference to the policy wording, and the customer is reminded of their right to refer to the Financial Ombudsman Service if eligible.
FCA Handbook, ICOBS 8. Financial Services and Markets Act 2000, sections 137A and 138. Insurance Act 2015. Consumer Insurance (Disclosure and Representations) Act 2012. Third Parties (Rights against Insurers) Act 2010. UK retained Insurance Distribution Directive (Directive (EU) 2016/97), Article 17.
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.
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