IBCCC shares its findings about implementing the Code of Practice in new report

The Insurance Brokers Code Compliance Committee (IBCCC) has published a new report – ‘Implementing the 2022 Code’ – which highlights how Code subscribers are progressing in their implementation of the 2022 Code of Practice, along with best practice guidance to ensure compliance with the Code.  

The new Code came into effect on 1 November 2022, with Section 6.1 taking effect from 1 November. To assist with the transition to the new Code for subscribers, the report outlines some resources such as – Complying with the 2022 Code and Comparing the Codes – how the 2014 and 2022 Codes differ – that were created for subscribers.  

The report also acknowledges the work NIBA undertook in ensuring a smooth transition to the new Code for subscribers. NIBA has published several resources, including the Member Implementation Guide, Identifying and Supporting Vulnerable Clients Guide, and the Terms of Engagement template that subscribers can use to help ensure they’re fulfilling their Code obligations.  

The report categorised its findings and best practice recommendations into key thematic areas. These are outlined below.  

Providing training to help with transition 

The report identified training as one of the key focus areas for subscribers in this transition period as they adopted the new Code. Almost half (46%) of subscribers reported “training as the business area that needed the greatest amount of change” while undergoing transition to the new Code.  

Furthermore, “more than half” (58%) of subscribers intend to undertake some kind of “additional in-house training” to aid this transition.  

NIBA’s guidance collateral on implementing the Code such as the Member Implementation Guide as well as Identifying and Supporting Vulnerable Clients were noted as useful training tools by Code subscribers.  

The best practice recommendations on providing training include: 

• Ensuring that all levels of staff – from new starters and the Board – are educated on their responsibilities as under the Code 
• Promote a culture of safety around breach reporting 
• Setting “clear expectations” for Code compliance, monitoring and reporting. 

Keeping processes, policies and procedures up to date 

The IBCCC was pleased to note that a considerable majority of Code subscribers had updated their existing business frameworks as part of the transition. The report highlights that 63% of subscribers updated their processes, 60% their procedures and 56% their policies.  

The high level of uptake is evidence that “subscribers took Code transition seriously” and that it was a priority for them. This is heartening to see, as one of the key takeaways of NIBA’s Member Implementation Guide was that subscribers should review their existing frameworks to ensure they are meeting the updated Code requirements.  

Providing clients with a Terms of Engagement document 

According to the report, close to one-third (31%) of subscribers highlighted that providing a Terms of Engagement document to their clients was an “additional change” for them, as prior to the 2022 Code, there was no requirement for subscribers to provide this document to their clients.  

To assist with Code compliance, NIBA has created a Terms Engagement template that can be accessed and tailored as per subscriber needs, available on the website.  

As part of best practice, the report recommends that: 

• The Terms of Engagement is written in “clear, concise and plain language” 
• It should be accessible to the public 
• Should be discussed with the client during the client onboarding process, if possible. 

Supporting vulnerable clients 

Even though the requirement to ensure subscribers are identifying and supporting vulnerable clients is a change that’s been implemented in the new Code, less than one-third (31%) of subscribers noted that this was an area where they had to undergo significant changes to remain Code compliant.  

The IBCCC notes that it will publish a follow-up report outlining findings about how subscribers are identifying and supporting vulnerable clients in line with the Code.  

Ensuring there is reporting on Code compliance 

The new Code includes a requirement that subscribers have a procedure in place to regularly update the Board or Executive Management regarding Code compliance. The report highlights that subscribers have adopted a myriad of ways through which they’re currently fulfilling this requirement.  

The main differences in the procedures adopted during reporting depend on whether a subscriber is a small broker or a large broking organisation. While a larger subscriber might have a Risk & Compliance Committee that’s dedicated to reporting, smaller brokers might rely more on self-reporting by staff or other reports generated from compliance systems.  

Obligations around complaints handling 

The IBCCC report notes that the current obligations around complaints handling in the new Code go “beyond regulatory requirements to protect clients.” 

The report recommends subscribers review their existing processes to ensure they are compliant with Section 9 of the Code. As part of best practice, the report suggests establishing a procedure for escalating complaints and implementing a system that helps track the progress of each complaint.  

You can read more about the findings from the IBCCC report and best practice recommendations here.