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MIPRU 5.1 Application and purpose

Application

01/10/2018R

This chapter applies to a firm with a Part 4A permission to carry on:

  1. (1)

    insurance business; or

  2. (1A)

    insurance distribution activity; or

  3. (2)

    home financing;

  4. (3)

    [deleted]

04/06/2019R
  1. (1)

    This chapter also applies to a firm which is a P2P platform operator facilitating a regulated mortgage contract, home purchase plan, home reversion plan or regulated sale and rent back agreement where the lender or provider under that contract does not fall within the definition of a mortgage lender, home purchase provider, reversion provider or regulated sale and rent back firm.

  2. (2)

    Where (1) applies, references to a firm using the services of another person consisting of insurance distribution, insurance distribution activity or home finance mediation activity are to be read as references to the P2P platform operator using those services.

Purpose

01/10/2018G

The purpose of this chapter is to implement article 16 of the IDD in relation to insurance undertakings and insurance intermediaries. The provisions of this chapter have been extended to home finance providers in relation to insurance distribution activity, and to insurance undertakings and home finance providers in relation to home finance mediation activity, to ensure that firms using these services are treated in the same way and to ensure that clients have the same protection. To avoid the loss of protection where an intermediary itself uses the services of an unauthorised person, this chapter also ensures that each person in the chain of those providing services is authorised.

01/04/2009G

This chapter supports the more general duties in Principles 2 and 3, and the relevant rule in the Senior Management Arrangements, Systems and Controls sourcebook (see SYSC 3.1.1 R and SYSC 4.1.1 R).

MIPRU 5.2 Use of intermediaries

01/10/2018R

A firm must not use, or propose to use, the services of another person consisting of:

  1. (1)

    insurance distribution; or

  2. (1A)

    reinsurance distribution; or

  3. (2)

    insurance distribution activity; or

  4. (3)

    home finance mediation activity;

unless MIPRU 5.2.2 R is satisfied.

[Note: Article 16 of theIDD]

01/10/2018R

MIPRU 5.2.1R does not apply to a firm carrying on an insurance distribution activity if it uses or proposes to use the services of a person consisting of home finance mediation activity. In that case, MIPRU 5.2.2R does not need to be satisfied.

01/04/2013G

The appropriate regulator regards a firm as 'using' the services of, in particular, its immediate counterparty (typically the intermediary that passed the business to the firm) and of all other persons who have been granted the right or authority directly by the firm to effect a contract of insurance or enter into a home finance transaction.

01/01/2021R

For the purposes of MIPRU 5.2.1 R, the person, in relation to the activity must:

  1. (1)

    have permission; or

  2. (2)

    be an exempt person; or

  3. (3)

    be an exempt professional firm; or

  4. (4)

    [deleted]

  5. (5)

    in relation to insurance distribution activity, not be carrying this activity on in the UK; or

  6. (6)

    in relation to home finance mediation activity, not be carrying this activity on in the United Kingdom.

[Note: article 16 of theIDD]

01/01/2021E
  1. (1)

    A firm should:

    1. (a)

      before using the services of the intermediary, check:

      1. (i)

        the Financial Services Register;

      2. (ii)

        [deleted]

      for the status of the person

      ; and

    2. (b)

      use the services of that person only if the relevant register indicates that the person is registered for that purpose.

  2. (2)
    1. (a)

      Checking the Financial Services Register before using the services of the intermediary and using the services of that person only if the Financial Services Register indicates that the person is registered for that purpose may be relied on as tending to establish that:

      1. (i)

        the person, in relation to the activity, has permission; or

      2. (ii)

        the person, in relation to insurance distribution activity, is an exempt person or an authorised professional firm.

    2. (b)

      [deleted]

01/04/2013G

The Financial Services Register can be accessed through the FCA website under the link www.fsa.gov.uk/register/home.do