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CII IF9 study materials
CII IF9 study resources

CII IF9: Conduct of Business Rules and Consumer Protection

CII IF9 · Work through your exam, one topic at a time.

All guide sections

Conduct of Business Rules and Consumer Protection

This domain tests how firms must treat customers when designing, selling and administering insurance. Expect questions on the FCA Principles, ICOBS, the fair treatment of customers outcomes, the Consumer Duty, financial promotions and product governance.

The framework

  • PRIN: eleven Principles for Businesses, including integrity, skill and care, fair treatment, clear communications and managing conflicts.
  • ICOBS: product disclosure including the IPID, demands and needs statements, cancellation rights, claims handling and remuneration disclosure.
  • TCF: six outcomes covering culture, products, clear information, suitable advice, performance and claims.
  • Consumer Duty (PRIN 2A): in force 31 July 2023 for open products and 31 July 2024 for closed products. Four outcomes - products and services, price and value, consumer understanding, consumer support - plus cross-cutting rules: act in good faith, avoid foreseeable harm, and enable customers to pursue their financial objectives.
  • PROD 4: product governance for insurers and distributors, including target market and value assessment.
  • Financial promotions: s.21 FSMA requires approval or authorisation; communications must be fair, clear and not misleading.

Vulnerable customers

Firms must identify and respond to characteristics of vulnerability - health, life events, resilience, capability - and adjust outcomes accordingly.

Worked example

An insurer sells GAP insurance through a distributor at a price including a very high commission. Under the price and value outcome, the firm must be able to show the total price is reasonable relative to benefits and that the distribution arrangement does not distort value. A failure is not cured by disclosure alone: foreseeable harm must be avoided, and the firm should redesign or withdraw the product. Separately, ICOBS requires a demands and needs statement, so a purely "opt-out" sale with no assessment breaches both regimes.

Traps that cost marks

  • Treating TCF and the Consumer Duty as the same thing; the Duty adds enforceable cross-cutting rules and a private right of action.
  • Assuming disclosure cures poor value.
  • Forgetting the staggered implementation dates for closed products.
  • Overlooking that ICOBS continues to apply alongside the Duty.
  • Ignoring vulnerable customer requirements.