Reference Case Number: FOI9743
Freedom of Information: Right to know request:
I am requesting the number of instances where action has been taken against brokers by the FCA regarding COVID BI claims, if feasible then broken down into severity (e.g. warning issued, action required from a firm, action taken against a broker) and set out by month.
I am also requesting the number of instances where action was taken against insurers by the FCA regarding COVID BI claims, if feasible broken down into severity (e.g. warning issued, action required from a firm, action taken against an insurer) and set out by month.
FCA response:
We hold some of the information you have asked for and our response is below.
By way of background, we would like to explain that we engaged with insurers and brokers from the emergence of the Covid-19 pandemic in the UK in March 2020. This exercise was initially for information gathering purposes and primarily focused on those firms with potential business interruption (BI) exposure. We explain below how this engagement evolved over the following two years.
Following the Supreme Court judgment following the FCA test case, we requested data from firms in various formats including the FCA published data request. This was a monthly data collection from all insurers with non-damage BI claims. We requested and published this data monthly between March 2021 and February 2022. The 14th iteration of this data was collected in September 2022 and published on 4 October 2022 for 57 insurers.
We engaged with a selection of these 57 insurers to varying degrees between 2020 and 2022. The level and frequency of engagement was led by both good and poor indicators identified in the BI claims data including the progress of BI claims to full and final settlement. We engaged with a small selection of brokers in the same manner. As this engagement occurred over an extended time, we are therefore unable to provide an accurate breakdown by month.
We can confirm that in 2022 there was supervisory action taken against at least one insurer, however we are prohibited from disclosing the type of action taken to you, as it constitutes ‘confidential information’ for the purposes of section 348 of the Financial Services and Markets Act 2000 (FSMA), and which the FCA has received in the discharge of its public functions. We are therefore prohibited from disclosing this information under section 44 of FOIA. For more information on why this exemption applies, please see Annex A. We can confirm that we do not have a record of any action being taken by the FCA against brokers related to BI insurance.