Category: Compliance & AML · Reviewed by Al Jabbar, Broker · Specialist Risks · Last reviewed June 2026
The Consumer Duty distinction between the firm that designs the product (manufacturer — responsible for the target market, the fair value assessment and distribution strategy) and the firm that brings it to the customer (distributor — responsible for confirming target market alignment, adding value appropriately and feeding outcomes back to the manufacturer).
Within the Consumer Duty framework, the manufacturer is the firm with primary responsibility for product design, target market definition and fair value at the source. The distributor is the firm that places the manufacturer’s product with end customers. Both have duties; the duties differ in focus and depth.
FCA Handbook, PRIN 2A.3 (Products and Services) and PRIN 2A.4 (Price and Value), with cross-references in PRIN 2A.7 (information flows). ICOBS 6A POG rules also distinguish manufacturer and distributor obligations. PROD 4 has equivalent provisions for the wider insurance perimeter.
Manufacturer duties include: design of products that meet target market needs; identification of the target market and any negative target market; fair value assessment with an explicit fair-value statement; distribution strategy and channel suitability assessment; ongoing monitoring; provision of distributor information sufficient for the distributor to discharge its own duties. Distributor duties include: review of manufacturer information; confirmation of target market alignment for the distribution; assessment of the distributor’s own value add (fees, services); monitoring of distribution outcomes; feedback to the manufacturer; corrective action where issues are identified.
Where a distributor materially alters the product (e.g. a broker MGA bundles cover, sets pricing components or designs key features), it becomes a co-manufacturer and assumes manufacturer duties for the relevant elements. The distinction is functional, not formal — a firm’s role can vary product-by-product.
Apex is a distributor of carrier products on most of its commercial lines. For these products Apex confirms target market alignment, assesses its own value add (broker fee, advice, claims advocacy), monitors outcomes and feeds back to the carrier. Where Apex were to design a scheme product with bespoke wording, target market and pricing, it would assume co-manufacturer duties on those elements.
FCA Handbook, PRIN 2A.3, PRIN 2A.4, PRIN 2A.7. FCA Policy Statement PS22/9. UK retained Commission Delegated Regulation (EU) 2017/2358 (POG for insurance products). FCA Handbook, ICOBS 6A and PROD 4.
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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