CII launches vulnerable customer guide

The Managing Customer Vulnerability in Insurance and Personal Finance: A Practical Implementation Guide has been created by the professional body to help insurance and personal finance firms to better identify, support and deliver fair outcomes for clients in vulnerable circumstances.

The CII noted that up to half of UK adults show characteristics of vulnerability at any given time, most will experience vulnerability at some point during their lives.

As a result, it said that firms which fail to manage vulnerability effectively are unlikely to meet the Financial Conduct Authority's Consumer Duty obligation of providing good outcomes for all customers.

The CII said the guide provides practical resources to help firms translate regulatory intent into measurable action.

It includes:

• A six-step vulnerability management framework: identify, quantify, monitor, support, adapt and report.
• A focus on data infrastructure and outcomes reporting, addressing areas of improvement identified in recent FCA reviews.
• Guidance on the enabling elements required for successful vulnerability management including leadership commitment, training effectiveness and good practice for data sharing.
• Implementation pathways with proportionate approaches for firms of different sizes and complexity.
• Practical tools including checklists, case studies and system selection criteria.

The guide has been developed in collaboration with vulnerability experts, customer experience practitioners and individuals with lived experience of vulnerability, the CII set out.

"Effective vulnerability management is about more than regulatory compliance. It is about creating a fairer, more resilient system for all customers," said Matthew Hill, CEO, the CII.

"In embedding the principles of this guide into their culture and operations, firms will not only meet the expectations of good practice but also contribute to the development of a sector that conscientiously strives to meet the needs of every customer."

Supporting vulnerable clients ‘fundamental' to good financial planning

Carla Brown, president, PFS, added that supporting clients in vulnerable circumstances is "fundamental" to good financial planning.

"Our community is committed to raising standards and ensuring that every client, whatever their situation, receives the care, understanding and outcomes they deserve," she said. "This publication will help professionals across the sector strengthen their approach and, ultimately, deliver better experiences for the people who rely on us most."

Johnny Timpson, chair, Absolute Military, said: "I've long held that the test of our progress as an industry and profession together with the delivery of our professional body's Royal Charter promise should not simply be measured in adding to the abundance of those we serve and/or improving their resilience to perils and shocks but importantly, in ensuring that the vulnerable customers we serve enjoy the same access, inclusion, protections and outcomes as anyone else."

"[The guide] is a great example of the professional body convening power, bringing together a diverse range of expertise for the benefit of wider society," added Eddie Grant, UK cabinet office disability and access ambassador (insurance and financial planning). "This guide offers actionable steps that firms of all sizes can take to better understand, anticipate and meet the needs of customers who may be at greater risk of harm."

Grant added: "I am particularly encouraged by the guide's emphasis on enabling elements and proportionate approaches building trust, removing barriers and ensuring that everyone can access the financial services they need to thrive.

"I urge our members and beyond to read, share and implement the insights in this guide."