The FCA is to look at whether commissions paid to advisers who recommend protection products deliver value for clients, as part of a wider market study following the introduction of the consumer duty.
When the regulator’s predecessor, the Financial Services Authority, introduced the retail distribution review, it considered banning commission for protection products. However, it eventually concluded there was no evidence that commission on the sale of pure protection products led to poor customer outcomes.
Now though, the FCA is returning to the topic with an eye on value for money, a key focus of the consumer duty. In a statement published this morning, the regulator said it would look into whether paying intermediaries in this way provided value for consumers.