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The FCA's Consumer Duty implementation deadline has passed. Most MGAs and coverholders submitted their board attestations on time. Many are now discovering that attesting to good customer outcomes and being able to evidence them are two different things - and the distance between those two positions is becoming visible in FCA supervisory activity.
The gap is operational rather than intentional. The challenge for MGAs and coverholders is not that they are producing poor customer outcomes. Most are not. The challenge is that the operational infrastructure required to demonstrate good outcomes consistently, across a delegated authority chain, in the format and at the granularity the FCA expects, was not built for this purpose. In many cases, it cannot be retrospectively configured to produce the required evidence without deliberate process and systems work.
Three specific operational failures are appearing most frequently when we assess MGA operational readiness against Consumer Duty requirements.
Failure 1: Outcome evidence that stops at policy issuance
Consumer Duty requires evidence of good outcomes at every stage of the customer journey - including post-sale service, at renewal, and at the point of claim. Most MGAs have well-developed data on new business volumes, pricing adequacy, and conversion rates. Very few have structured, auditable data on customer experience after the policy is issued.
The question the FCA will ask during a supervisory review is not "do you have a customer service process?" It is: show me the data that demonstrates customers in your highest-risk segments - those in vulnerable circumstances, those approaching renewal with deteriorating risk profiles, those who have experienced a claim - are receiving outcomes consistent with your Consumer Duty commitments.
If the answer to that question relies on a combination of Acturis management reports, manually maintained spreadsheets, and email thread records, the operational evidencing infrastructure does not yet exist in a form that will withstand scrutiny. The FCA's supervisory approach to Consumer Duty is outcomes-focused rather than process-focused.
A well-documented process with no outcome data is not compliance - it is documentation of intent.
The operational fix requires three things: a clear definition of what "good outcome" means for each customer segment at each stage of the journey, a data capture process that records the evidence at the point it occurs rather than reconstructing it retrospectively, and a governance process that reviews the evidence on a defined cycle and acts on what it shows.
Failure 2: The delegated authority chain evidencing problem
Coverholders sitting between capacity providers and end customers face a specific structural challenge. The Consumer Duty obligation runs through the chain: the capacity provider is responsible for the outcomes delivered to end customers through the coverholder's distribution network, and expects the coverholder to evidence that those outcomes meet the required standard.
The operational infrastructure required to evidence this systematically - consistent data capture across appointed representatives, structured management information from distribution partners, documented oversight processes with defined escalation paths - is more demanding than most coverholders anticipated when they submitted their Consumer Duty implementation plans.
In practice, data quality and coverage across a network of appointed representatives is inconsistent. Some sub-distributors have good digital infrastructure and can produce structured data on demand. Others are operating on older systems or manual processes and cannot provide data in a consistent format or on a consistent timeline.
The coverholder cannot evidence good outcomes across its distribution network if parts of that network are not producing the data required. Addressing this requires a distributor assessment exercise - understanding where the data gaps are and what remediation each sub-distributor needs - and building oversight into the distribution management process rather than treating it as a compliance exercise conducted annually.
Failure 3: Vulnerable customer identification that is policy rather than process
Every MGA reviewed in the last 12 months has a vulnerable customer policy. A smaller proportion have a vulnerable customer process - a defined operational workflow that specifies how a customer who may be in vulnerable circumstances is identified during a customer interaction, how that identification triggers a different handling approach, how the outcome of that handling is recorded, and how the aggregate data is reviewed by management.
The FCA's distinction between a policy and an operating process is not semantic. A policy describes what the firm believes should happen. A process specifies what actually happens, step by step, with defined responsibilities and a recording mechanism. The FCA's Consumer Duty supervision will look for evidence that the policy is being followed consistently in practice - and that evidence comes from process records, not policy documents.
The operational gap is typically in the interaction recording. The customer service or underwriting team may handle a vulnerable customer appropriately in the moment. Without a structured recording requirement - a defined field in the CRM or policy administration system such as Acturis, a defined escalation log, a defined review cycle - that appropriate handling produces no evidence that can be presented to a regulator or a capacity provider.
Is your Consumer Duty evidence ready for the next attestation?
Consumer Duty is not a one-time implementation exercise. It is an ongoing operational discipline with an annual board attestation cycle. MGAs that treated the initial implementation as a project with an end date are now discovering that the second attestation cycle requires evidence that the operational disciplines are sustained - not just that they were established.
The distinction between "we built the process" and "we operate the process and have data to show it" is where the real compliance work lies. Firms that address this operationally - building the evidencing into day-to-day processes rather than treating it as a compliance overlay - will find the second and third attestation cycles significantly easier than the first.
Those that do not will find FCA supervisory interest focusing on precisely the gap between their attestation and their evidence.
Assessing your Consumer Duty operational readiness?
We work with MGAs and coverholders on FCA compliance, operational evidencing infrastructure, and regulatory programme management.
