How are Zurich preparing for the Consumer Duty?

The Duty applies to all retail customers. The FCA definition includes individual customers and small and medium sized commercial customers.

We are applying the Consumer Duty to all Personal Lines, Small and Medium sized Enterprises, Zurich Municipal, Life Protection and Corporate Protection customers, and existing customers who have a Pension or Investment with Zurich. We will also be applying Consumer Duty principles to some Commercial customers too.

For products closed to new business, we are working towards the 31 July 2024 deadline. This will include the following:

• All of our protection products sold until 2018 (up to the launch of our Life Protection Platform)
• All of our investment products
• All of our onshore pension products.

Consumer Duty is aligned with our culture and our strategy to focus on customers. But it requires us to reflect and assess where we can make improvements to consistently deliver good outcomes to our customers.

We are well underway in our preparations and planning. We’ve created a project team and conducted a gap analysis across the outcomes and cross cutting rules. We are now working through those actions, such as reviewing our processes, and designing a customer testing framework. Where we find issues and areas that we need to improve, we will make it a priority to fix them.

The FCA have set clear expectations that we monitor, understand, and evidence the outcomes that customers are receiving. Zurich has a Customer Outcomes Framework, which will support compliance with the Consumer Duty. Our Customer Outcomes Framework regularly monitors outcomes across a number of customer touch points.

Our Customer Outcome monitoring will be frequently reported to our senior management.

We have a robust Product Oversight and Governance process which reviews whether our products and services are fit for purpose, designed to meet the needs of the intended target market and are distributed appropriately.

When designing new products, and through our ongoing monitoring of existing open and closed products, we consider whether they have features that could cause harm for any group of customers, including those with characteristics of vulnerability.

Where we find issues and areas that we need to improve, we will make it a priority to fix them.

Useful links:

• Product approval process (186.6 KB/PDF)

We undertake fair value assessments where appropriate to look at whether there is a reasonable relationship between the price a customer pays for a product or service and the benefits they receive from it.

All of the Zurich products which were tested passed this assessment last year.

We will continue to carry out fair value assessments on at least an annual basis to evidence that our products continue to provide fair value.

Useful links on Fair Value:

• Fair value rules

Across our business, we’re reviewing customer communications to identify which ones require customers to act or have the potential to cause harm if they’re misunderstood.

We’re conducting testing with customers to make sure our communications meet the Consumer Duty requirements.

Our research will test our communications and review if:

• they meet customer expectations,
• our customers understand what the communication says,
• customers understand what they should do next.

Where our research indicates areas of improvement, we will update these documents to deliver good customer outcomes.

We will regularly monitor the customer support we provide. Where we find issues and areas that we need to improve, we will make it a priority to fix them.

We will design and deliver support to meet the needs of our customers, adopting a flexible approach when dealing with customers with characteristics of vulnerability.

All employees dealing directly with customers are appropriately trained to identify individuals in vulnerable circumstances and how to provide appropriate support.

Useful links:

• How to identify and support vulnerable Life customers

Our Customer Wellbeing Policy has been designed to enable us to feel able to identify and support our customers when they face challenging times.

We aim to ensure we:

• Make our products clear and easy to understand.
• Offer flexible communications to make sure they are inclusive of all customers.
• Work with vendors and suppliers who uphold our standards in supporting customers with all vulnerabilities.
• Provide appropriate employee training and support to increase awareness of customer vulnerability.

Our approach to customer wellbeing can be found here that provides customers with information on how we may be able to support their wellbeing.

It is our expectation that any partner of Zurich involved in the settlement of customer Claims, will adhere to the FCA Consumer Principle, plus associated cross-cutting rules and outcomes. Additional data may be requested to ensure that Zurich can robustly monitor customer outcomes at all parts of a customer journey, regardless of whether handled directly by Zurich, or elsewhere.