| Link(s): | CII response to FCA discussion on competition impacts of Big Tech on financial services industry |
Context
In response to the FCA’s launch of its discussion on the impacts of Big Tech on financial services, the CII has said that it is aware that some Big tech firms might consider themselves to be in a strong position to deliver insurance to consumers and SMEs in a convenient way, as the insurance buying public depends more and more on mobile technology for payments, checking finances, and for purchases. The CII’s Trust Index also shows that ‘ease of doing business’ is an important factor for consumers and SMEs when buying insurance.
Key points to note
The CII has stated that:
- experience with comparison websites shows that competition can be skewed towards what is easy to comprehend, with quality of advice and cover losing out to price and convenience;
- this is despite the fact that both consumers and SMEs rate ‘confidence that the insurance will pay out’ as the most important factor, and SMEs rate protection – having cover that closely matches their needs – as the third most important factor;
- it is important that the FCA uses the introduction of its Consumer Duty to ensure that competition is driven by the factors that consumers and SMEs believe is most important – this is more often about reliability of cover than price.
Next actions
None – for information and awareness.