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Insurance brokers have until December 2019 to implement SMCR. Firms that start preparations early can benefit from the opportunities the regulation can bring.
Insurance brokers need to bring their firms into line with SMCR by the end of 2019. Nine months isn’t a lot of time, but there’s still time to get ahead of the curve.
We’ve been working with a range of financial institutions on the regulation ever since the first wave in 2016. Our client experiences have shown us that SMCR implementation can be a highly positive move – from overhauling governance through to increased operating efficiency.
The implementation process, and subsequent business as usual (BAU) running of SMCR, is an opportunity to make sure you have a well-run organisation with good governance, high employee wellbeing, confident customers, and accountability in all the right places.
These benefits depend on adopting a thorough and systematic approach. Tackling SMCR is a bit like getting an MOT for your car – you could just treat it as a pass/fail exercise, but ideally you should use the opportunity to find out what you need to do to keep your car running safely and comfortably. Similarly, to get best results from SMCR, don’t stop at compliance. Instead, embrace the opportunity to make your company run as smoothly as possible.
Resources to help you prepare
Every broker needs to plan the SMCR journey individually. Starting with proven tools and solutions can speed you on your way to a robust plan and a smooth transition. We’ve prepared a number of resources (found below) that you’re welcome to get in touch with and request from us today. Our dedicated SMCR team have developed these tools and already used them successfully with financial services clients.
A 25-point plan setting out what a successful SMCR implementation project looks like. The 25 points are grouped under four headings:
- the Senior Managers Regime;
- the Certification Regime and fit and proper requirements;
- the Conduct Rules;
- HR Processes, Employment Law, Compliance.
You can use this plan to establish what each point will involve and how long it should take, to avoid nasty surprises later!
A document on “reasonable steps”, with a list of activities to perform in order to be able to show regulators that you are taking reasonable steps to manage and control the business.
Benefits you can expect
Smooth running, clear accountability and a robust, effective governance structure are among the obvious benefits that can be gained by approaching SM&CR the right way. Client experience shows that there are other benefits too.
For example, implementing SMCR is a great opportunity to sense-check the governance mechanisms you already have in place. This can be easier if you take outside advice. One client told us that they had 16 board members. With SMCR in place, having such a large board would raise questions of who of the 16 board members were senior management function holders. In addition, not all members will necessarily want the additional accountability associated with SMCR.
Steps to take today for insurance brokers
To get started on your SMCR implementation – or to make sure current implementation projects are on the right lines – please feel free to get in touch to request our project resources (see above).
We’ll be running a governance round table covering topics like SMCR and IDD in the near future, so get in touch if this might be of interest.
Remember, the sooner you get started, the earlier you can start reaping the benefits.
