ICOBS disclosure

Category: Regulation and conduct · Reviewed by the Apex broking team · Last reviewed 2026-08-22 · ~6 min read

What ICOBS is

ICOBS is the FCA Handbook sourcebook governing the conduct of general insurance business — non-investment insurance contracts sold to consumers and to commercial customers. It sets out what firms must tell customers, how products must be described, what standards apply to advice, and how claims must be handled. Its disclosure rules are the part customers encounter first, usually in the document a broker sends at the start of a relationship.

The sourcebook applies alongside, not instead of, the Principles for Businesses and the Consumer Duty. Complying with the letter of a disclosure rule does not discharge the higher obligation to communicate in a way the customer can actually understand and act on.

Status disclosure: ICOBS 4

The central rule requires a firm, in good time before conclusion of an initial contract of insurance and where necessary on amendment or renewal, to tell the customer its identity and address and whether it is an insurance intermediary or an insurance undertaking, together with its complaints procedures and whether the Financial Ombudsman Service is available.

An intermediary must add more: how the customer can check its registration on the Financial Services Register; whether it holds ten per cent or more of an insurer, or an insurer holds ten per cent or more of it; and whether it is acting for the customer or on behalf of the insurer. These are the questions that go to independence, and they exist so that a customer can see whose interests the firm is structurally aligned with.

The scope-of-service statement

Separately, an intermediary proposing or advising on a contract must state whether it gives a personal recommendation on the basis of a fair and personal analysis of the market; or is under a contractual obligation to place business exclusively with one or more insurers, in which case it must name them; or is not under such an obligation and does not give advice on a fair and personal analysis, in which case it must name the insurers it may and does place business with.

This is more than a formality. “Fair and personal analysis” is a defined standard requiring an analysis of a sufficiently large number of contracts available on the market. A firm that describes itself as advising on that basis has taken on the obligation to have done so, and a firm that has not should not be claiming it.

Remuneration: nature, fees and commission

Before conclusion of a contract, an intermediary must disclose the nature of the remuneration it receives — whether it is a fee paid directly by the customer, a commission included in the premium, some other economic benefit, or a combination. Where a fee is charged, the amount must be given before the customer incurs liability to pay it, or the basis of calculation where the amount cannot yet be stated, and this covers fees payable during the life of the policy as well as at inception.

Commercial customers have a further right: on request, the firm must promptly disclose the commission it receives in relation to the policy, in cash terms where possible and in a durable medium. That right is exercised far less often than it could be. A commercial buyer comparing broking propositions is entitled to ask, and the answer is often instructive.

How the information is given also matters. It must be provided in a clear and accurate manner comprehensible to the customer, on paper or another durable medium, or on a website where the conditions for that are met — and consent to website delivery has to be an active and informed choice, not a pre-ticked box.

The rest of the disclosure framework

Status disclosure is only one layer. The sourcebook separately requires a firm to identify the customer’s demands and needs and to ensure the contract proposed is consistent with them, with a personal recommendation additionally having to be suitable; that is the subject of the demands and needs statement. Product information rules govern what must be given about the contract itself, including the standardised insurance product information document for retail customers — see product information.

There is also a chapter dealing with claims handling, which contains the rules on handling claims promptly and fairly and, in commercial employers’ liability business, the requirements behind the employers’ liability register and tracing office arrangements. Those claims-handling provisions are dealt with in their own entries in this wiki rather than here.

Underpinning all of it is the wider distribution regime derived from the Insurance Distribution Directive and now embedded in the Handbook, together with the product governance and fair value requirements that sit alongside it.

Why it matters to a commercial buyer

The disclosure documents are usually skimmed, which is a pity, because they answer three questions that decide whether a broking relationship is worth having. Is this firm searching the market, restricted to a panel, or tied? Is it acting for me or for the insurer? And how is it paid, by whom, and how much?

If any of those answers is unclear from the documents provided, ask for it in writing — a commercial customer is entitled to the commission figure on request. And if you are comparing brokers, compare the scope-of-service statements rather than the covering letters. The regulated wording is where the differences actually appear.

Frequently asked questions

What must a broker tell me before I buy a policy?

Its identity and address, whether it is an intermediary or an insurer, how to complain and whether the Financial Ombudsman Service is available, how to check its registration, any significant cross-shareholdings with insurers, whether it acts for you or the insurer, the basis on which it selects products, and the nature of its remuneration.

Can I ask a broker how much commission it earns?

If you are a commercial customer, yes. On request the firm must promptly disclose the commission it receives in relation to the policy, in cash terms where it can be given and in writing or another durable medium.

What does 'fair and personal analysis' mean?

It is the standard a firm claims when it says it advises on the basis of an analysis of a sufficiently large number of contracts available on the market. A firm that is contractually tied to one or more insurers, or that works from a limited panel, must say so and name the insurers instead.

When must the information be given?

In good time before the conclusion of an initial contract of insurance, and where necessary on amendment or renewal. Fee amounts must be given before the customer becomes liable to pay them.

Related entries

• Insurance Distribution Directive regime
• Demands and needs statement
• ICOBS 5 product information
• Broker commission and fee transparency
• Insurance broker

This entry is part of the Apex Insurance Wiki. This entry states the position as at August 2026. It is insurance information, not legal advice. Last reviewed 2026-08-22. Next review: 2027-02-22.

Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority (FRN 724952). This page is general information, not advice on a specific policy.