June Regulatory Bulletin
Welcome to our June Regulatory Bulletin - it's been over a month since GDPR came into effect, we hope the information and support we've made available to you has helped you navigate the regulations as smoothly as possible. This month we focus our update on how we're progressing our preparations for the Insurance Distribution Directive and Brexit.
The day has arrived and The General Data Protection act is now in force!
Hiscox would like to thank you for your cooperation over the last few months in ensuring our relationship is compliant in respect of how we communicate, how we advise our customers of their rights and of course our contract amendments.
There is however still some outstanding activity we ask for your support on helping us complete:
- There is a small number of you who are yet to sign and return your updated contracts – if that is you, please ensure you prioritise this activity and get it back to us as soon as possible so we can continue our valued relationship
- For those of you who need a version of the short form Fair Processing Notice (FPN) for printing or emailing purposes, please download and use this document
- For anyone that has yet to contact us regarding how to securely transfer data please email uk&[email protected]
For general guidance on GDPR please refer to the ICO website (external link).
The IDD comes into force in just over three months and it's important you make the necessary changes in order to be compliant ahead of October 2018. Our March Regulatory Bulletin highlights some key areas to be aware of, so please review this page for further information. The FCA have now indicated that the rules can now be deemed final, subject to some minor changes.
A few key updates:
- As part of the Hiscox APC product changes, document improvements include the introduction of the new Insurance Product Information Document (IPID) to enable the customer to better understand the product and more easily compare between different products.
- Product oversight and governance information will be provided for our open market products online, through our Broker Centre. Please check back later for further updates. If you are a delegated authority coverholder, this information will be provided separately
- As your role as a broker, paper policy documents must be offered with equal weight to email, free of charge.
Please make sure you check your respective financial services regulator's website for guidance and rules:
Should you have any questions or wish to discuss any of the above please email us at uk&[email protected]
As a result of the UK’s decision to leave the European Union, we are making some necessary changes to our business structure to ensure continuity of cover to all our customers with European risks. In most cases you should see and feel very little change from us, if any at all.
A key implication of Brexit is the loss of ‘passporting rights’ which allow Hiscox to conduct cross-border business throughout the European Economic Area (EEA) either directly from the UK or through our branch offices across Europe. Hiscox currently operates through an insurance company (Hiscox Insurance Company Limited), an agency (Hiscox Underwriting Limited) or via Lloyd’s of London, all of which are registered in the UK and will therefore lose their passporting rights.
Our priority is to ensure we can continue to provide products and services to policyholders with EEA risks; what that looks like will vary slightly depending on which part of the business you work with.
We have established a new European insurance company in Luxembourg, called Hiscox S.A., which received its license from the Luxembourg regulator in January 2018 and has an A rating from S&P. Hiscox S.A. will become the new home for the EEA-domiciled risks that we write through our European and UK branch networks.
A reminder – the Part VII transfer process
We intend to transfer all live policies and historical liabilities that would be impacted by the loss of passporting rights from Hiscox Insurance Company Limited to Hiscox S.A. as part of a legal process known as a Part VII transfer. This is proposed to take effect from 1st January 2019, with new business also being written into Hiscox S.A. from that date. This will ensure continuity of cover post-Brexit for all policyholders with European policies. Quotations will continue to be provided in the normal course of business and, depending on timings, will be either from Hiscox Insurance Company Limited or Hiscox S.A.
Coming soon – Communicating with policyholders
We are required as part of the transfer process to notify all affected policyholders. In Q3 2018, policyholders will receive a letter and a Scheme Booklet from us which will contain:
- some additional questions and answers;
- a summary of the Proposed Transfer;
- a summary of an Independent Expert’s report;
- notice of the Proposed Transfer; and,
- details of how they can contact us.
We are busy planning for this at the moment, and we may contact, or may have already contacted, your firm to seek your assistance in this.
We will keep you updated over the coming months. At this stage, you do not need to take any action. If you have any questions, please speak to your usual Hiscox contact.
How to find out more information
Our Brexit website (https://www.hiscoxgroup.com/about-hiscox/brexit) is kept up to date as our plans progress and more information about the Part VII transfer, access our Independent Expert’s report on the impact of the Part VII on our customers and our full Q&As will be available during summer 2018.