TECHNICAL TALK
ALTHOUGH THIS MARKET IS NOT CURRENTLY REGULATED , FROM 29 JULY 2022 , THE FCA WILL START TO REGULATE THE PRE-PAID FUNERAL PLAN SECTOR . THIS NEW REGULATION ALSO EXTENDS TO INTERMEDIARY FIRMS THAT DISTRIBUTE PRE-PAID FUNERAL PLANS .
Pre-paid funeral plans in the spotlight I am sure that most of you are familiar with the requirements of SM & CR , but an area with which you may not be as familiar with is pre-paid funeral plans . Not to be confused with whole of life plans or over- 50 plans , a pre-paid funeral plan is where a customer makes a payment to a funeral plan provider , either as a lump sum or as part of an instalment plan , to secure the provision of a funeral in the future . Although this market is not currently regulated , from 29 July 2022 , the FCA will start to regulate the pre-paid funeral plan sector . This new regulation also extends to intermediary firms that distribute prepaid funeral plans . Should your firm wish to advise on or arrange a pre-paid funeral plan after 29 July 2022 , you will need to submit a variation of permission ( VOP ) to the FCA to include this new regulated activity . If you wish to add this new regulated activity to your firm ’ s permissions , you must do so by submitting a VOP via FCA ’ s Connect system , at a cost of £ 500 . Our Authorisations team are on hand and can assist you with this VOP .
ESG in the headlines One area that became more mainstream in 2021 was environmental , sustainable and governance ( ESG ) investing , and I believe that will only increase during 2022 . 2021 saw asset flows into ESG funds breaking records , bringing what was once considered a niche area of investing firmly into the headlines . The increase in flows was driven by a number of different factors , from increasing social awareness of issues , such as climate change and human rights infringements , through to a wider choice of ESG investment products . As you would expect , my main area of interest when it comes to ESG is forthcoming regulation in this area . There should have been rules implemented last year requiring advisers to consider a client ’ s sustainable investment preferences ; these rules were not implemented as a result of Brexit and the UK withdrawal from the EU . Although the ESG rules have not yet been implemented , we know that this is a key area of focus for the regulator , something which was demonstrated in November last year when they published their strategy on environmental , social and governance , setting out its target outcomes and the actions needed to deliver these outcomes . We are expecting a lot of activity in this area from the regulator during this year and , as always , our Policy team will keep you informed of any changes and developments when it comes to ESG regulation . We are aware of the FCA timeline of work / activities to be undertaken in 2022 and , rest assured , if there are any regulatory changes that will affect you , we will be in touch to both highlight the changes and the support that we offer to help you manage them .
You can speak to our compliance helpdesk at any time on 01484 439120 . To discuss what you ’ ll need to do in order to advise on pre-paid funeral plans , contact our Authorisations team on 01484 438110 .
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