Welcome to the UKGI weekly regulation update service for Aviva ABC brokers

Context

The FCA has published Handbook Notice 143, in which it has included details about Handbook updates in relation to Periodic and other fees for 2026/27, and Enforcement Guide updated relating to the Digital Markets, Competition and Consumers Act 2024 (DMCCA).

Key points to note and next actions

• The periodic and other fees update sets out the 2026/27 regulatory fees and levies for the FCA, FOS, and covers the rules that enable the FCA to collect certain levies on behalf of government departments. This instrument came into force on 2^nd July 2026, and feedback was published in a separate policy statement.
• The Enforcement Guide updates reflect changes in consumer protection legislation, describe the FCA’s general approach to the use of powers under DMCCA, and make clarificatory changes to how the FCA describes its general approach to use of non-FSMA powers and FSMA powers in the context of market abuse.
• The Enforcement changes also update legislative references in the FCA’s sourcebooks, and make changes relating to the Consumer Rights Act.
• The FCA has updated the redress section of its Unfair Contract Terms and Consumer Notices Regulatory Guide (UNFCOG) to reflect its powers under the DMCCA. It has also made changes to fully reflect the requirements of the CRA and better explain its supervisory approach to issues involving unfair or unclear terms.
• In the Insurance: Conduct of Business sourcebook (ICOBS) and Consumer Credit sourcebook (CONC), the FCA has substituted references to previous legislation so that they now refer to the DMCCA. It has removed the reference to Part 8 of the Enterprise Act 2002 in CONC 2.2.5 R as this has been repealed by the DMCCA. It has also included the DMCCA in its Glossary of definitions.

Context

The FCA has published details of a Warning Notice which sets out actions it is proposing to take in respect of the conduct summarised within the statement. At the relevant time, ‘Individual A’ was approved to perform senior management functions at a small, authorised firm (‘Firm A’), including acting as its Chief Executive and holding responsibility for compliance oversight and financial promotions.

Key points to note and next actions

• A warning notice is not the final decision of the FCA. The individual has the right to make representations to the Regulatory Decisions Committee (RDC) which, in the light of those representations, will decide on the appropriate action and whether to issue a decision notice.
• The FCA considers that Individual A acted with a lack of integrity during the period 21 October 2019 to 28 January 2025 (“the Relevant Period”). The FCA considers that Individual A knowingly presented a façade of regulatory legitimacy for the benefit of Individual B, who as a disqualified director (by reason of fraudulent activity), would not have been approved by the FCA to hold a senior management function and misled the FCA regarding the true ownership and control of Firm A. In doing so they breached Statement of Principle 1 and Individual Conduct Rule 1 for approved persons.
• In particular, the FCA considers that, during the Relevant Period, Individual A:
  • sold effective control of Firm A to Individual B through a transaction structured to conceal the true beneficial ownership and seek to avoid the FCA’s statutory change-in-control regime;
  • held his approved functions in name only and allowed Individual B and others to run the business;
  • allowed the authorised status of Firm A to be used as a “halo” which led to investors having a false confidence in the high-risk unlisted bonds which it marketed and issued. Investors suffered significant financial loss, totalling nearly £4.4 million, as a result; and
  • repeatedly provided false and/or misleading information to the FCA concerning who owned and controlled Firm A, and the extent of his own involvement in managing it after the sale.
• Firms and their owners and senior management should take note of the commentary above.

Context

The FCA has published a detailed new web page in relation to climate adaptation and resilience.  The web page is to provide information for regulated firms on how physical risks from climate change, such as flooding, may impact the property insurance and mortgage markets and how the FCA can help.

Key points to note and next actions

• Climate change is already affecting UK financial services.
• The Environment Agency estimates that 6.3 million properties in England are at risk of flooding. By 2050, that could rise to 8 million.
• Annual flood damage in the UK is estimated to cost £3.3 billion and could rise to £4.5 billion by 2050, according to the Climate Change Committee.
• Additionally, 346,200 home insurance policies were placed into the Flood Re scheme in 2024/25 – a 20% increase on the previous year.

Physical climate risks fall into two broad categories, as defined by the International Sustainability Standards Board (IFRS S2Link is external):

• Acute risks – sudden, event-driven disruptions such as floods, wildfires, storms, and heatwaves.
• Chronic risks – gradual, longer-term shifts such as rising sea levels, sustained temperature increases and changing rainfall patterns.

The FCA has identified five key risks so far, and provides brief commentary in relation to each:

• Reduced access to insurance.
• Insurance markets function less effectively.
• Consumers find it harder to obtain mortgages.
• Existing homeowners face higher costs and less choice.
• Markets find it harder to accurately price climate risk.

In relation to its work so far, for insurance, the FCA states that it has reviewed policy wording on key risks including flood and storm damage. Its 2025 review of home and travel claims handling highlighted the importance of clear policy information, helping consumers understand what is and is not covered, and delivering fair and transparent outcomes when customers make a claim. The FCA is also supporting the ABI’s work on storm claims.

The web page includes six suggestions for what insurers should consider, and sets out ways in which the FCA can help.

Context

The FCA has published a blog announcing the availability of Application Programming Interface (API) connectivity to its Handbook, along with a set of Q&As in relation to the API, a login page, and the Terms and Conditions of use of the API.  Access to FCA Handbook data is now available directly through the new API. The change supports better, faster compliance decisions and is part of the FCA’s work to be a smarter regulator by making our rules easier to access and use.

Key points to note and next actions

• The Handbook API gives firms a different way to get what they need. It enables systems to access structured Handbook content directly, making it easier to integrate rules, guidance and updates into the tools they already use.
• The FCA has made the Handbook API flexible, so firms can use it in the way that works best for them.
• Opening up the Handbook data creates various ways for firms to reduce manual processes and manage regulatory change, including real-time rule mapping, keeping track of rule changes, better RegTech products, and supporting AI solutions.
• The Handbook API is available to all users who have registered for a free account on the website. Usage will be subject to the Terms and Conditions; by accessing the Handbook API, firms and individuals are agreeing to those terms and conditions.

Context

FOS has issued its latest Ombudsman News e-mail in which it highlights its Q1 2026/27 complaints data, its Annual Report and Accounts 2025/26, and its new powers in relation to Deferred Payment Credit (known as ‘buy-now-pay-later’).

Key points to note and next actions

• FOS regularly publishes data and insight about the complaints it receives. The information is about complaints received during the first quarter (Q1) of this financial year, April to June 2026/27.
• The FOS Annual Report and Accounts give detail on the progress FOS has made during the year towards the delivery of its strategic aims. It also shares information about the financial performance of FOS, and its audited accounts.
• From 15th July 2026, consumers have been able to bring a complaint about ‘buy now, pay later’ (BNPL) to FOS.  If firms deal with customer complaints about ‘buy now pay later’ (BNPL), including deferred payment credit, the new FOS guidance gives an overview of the complaints it can help with and how it approaches them.

Context

As part of its ‘Views of the public’ information, the ICO has published its 2026 Public Attitudes on Information Rights report. This year, Savanta, on behalf of the ICO, spoke to over 7,800 people by conducting conducted a 15-minute online survey to find out about people’s understanding and opinions of privacy and information rights.  The report investigates how the public feels about their information rights, and how much trust they have in organisations to securely look after their personal information.

Key points to note and next actions

Some of the key highlights are:

• Public awareness of data protection rights is up to 77%.
• 76% have exercised one of their information rights.
• 51% are cautious about the privacy of their personal information.
• 18-34 year olds are more likely than 35-54 year olds and 55+ years old to say they have at least moderate trust in companies and organisations storing and using their personal information (63% vs. 56% and 54%).
• 40% said they chose to access a website for free with personalised ads and cookies.
• 88% have received a nuisance or spam message.

This research gives the ICO a clear picture of public understanding, priorities and trust in relation to information rights.

Context

The European Supervisory Authorities (ESAs), including EIOPA, have released a statement noting that the advanced capabilities of recent frontier AI models significantly accelerate cyber risks, underscoring the urgent need for robust cybersecurity measures and rapid incident response capabilities.

In a similar message to the statement published by the FCA in May 2026, the ESAs warn that AI-enabled cyber tools could generate systemic risks due to their ability to rapidly discover and exploit vulnerabilities, target vulnerabilities in shared infrastructure, and leverage single points of failure across entities.

Key points to note and next actions

• To strengthen risk mitigation, promote a coordinated supervisory approach and to ensure a level playing field across the EU, the ESAs are encouraging financial entities to adjust Information and Communication Technology (ICT) risk management processes, procedures and controls according to the following three risk mitigation strategies: i) prevention; ii) detection; iii) management.
• To assist firms, the statement includes an annex providing examples of risk mitigation strategies and actions firms may wish to consider, in order to improve resilience in the face of potential AI-driven threats.  The examples are listed under the titles of ‘Prevention’, ‘Detection’, and ‘Risk management and operational resilience’.

Context

The ABI has published details of the levels of claims support in Q2 2026 in relation to motor insurance and subsidence claims.  Motor insurance claims reach a new record high, and average subsidence claims are a result of prolonged hot weather.

Key points to note and next actions

• Insurers paid out a record £3.2bn to support motor insurance customers in Q2 2026, according to the latest data from the ABI.  This was 5% higher than the previous quarter, and 7% more than the same period last year.
• The average claim payout increased to £4,900, up 4% on the previous quarter, reflecting continued pressure from rising repair costs. While modern vehicles are increasingly fitted with advanced technologies such as cameras, sensors and driver assistance systems that can improve road safety, these features can also make repairs and replacements more costly. 
• Windscreen repairs in particular saw a sharp quarterly increase, with the average repair cost rising 7% to £283.
• Despite these ongoing claims pressures, motor insurance premiums remained relatively stable. The average premium paid rose by £6 (1%) during the quarter to £566. Adjusted for inflation, this remains £14 lower than the average premium in the same quarter of 2025.
• New figures from the ABI’s latest Property Insurance Tracker show home insurers paid out £72 million for domestic subsidence claims during the second quarter of 2026, with the average subsidence claim reaching a record £20,000.
• The average payout is more than £2,000 higher than in the same period last year, highlighting both the growing cost of subsidence and the vital protection insurance provides for homeowners.
• The figures follow the warmest spring on record in England and Wales, and the third warmest across the UK, with prolonged dry weather increasing the risk of ground movement and damage to properties.

Context

The CII has published the findings of a specialist roundtable that explored how the insurance market can help address workplace injuries across film, television and theatre production. The Workplace injury in UK entertainment production Roundtable summary report builds on the professional body’s partnership with the Injury Prevention Consultancy (IPC) formed in May of this year, and its support for the forthcoming IPC Impact of Injury 2026 (IOI26) research programme.

Key points to note and next actions

• Held in June, the roundtable convened underwriters, brokers, claims professionals and researchers specialising in entertainment insurance, to examine the gap between the high levels of workplace injury identified by IPC research, and the comparatively low volume of related insurance claims.
• The discussion was informed by findings from IPC’s Impact of Injury 2024 (IOI24) report, which found that 76% of screen performers and 85% of theatre performers had sustained workplace injuries during their careers.
• Roundtable participants agreed that cast injury claims remain relatively uncommon compared with other entertainment insurance claims, despite the prevalence of injuries reported by performers.
• Several ways in which the insurance sector could help drive change were identified, including using better injury data to inform underwriting decisions, recognising credible safety certification or training when assessing risk, and working collectively so that no single insurer is commercially disadvantaged for asking rigorous safety questions.

Context

A new group for cyber claims professionals in the London Market is being launched by the IUA.  The Cyber Claims Committee will hold its first meeting on October 15th, and is open to senior leaders working within cyber claims teams at London insurers and reinsurers. It will provide a forum for members to discuss market issues and emerging trends.

Key points to note and next actions

• The IUA already runs committees for cyber underwriters and cyber reinsurers. It has recently published research reports analysing cyber business interruption claims and cyber cover for warranty and indemnity risks.
• The new Cyber Claims Committee will aim to strengthen collaboration between claims and underwriting functions and promote best practices in the London company market. It will share insights to support underwriting strategy, product development, and risk management approaches.
• The group will also seek to address operational, regulatory and legal developments affecting cyber claims handling.