Christopher Woolard, director of strategy and competition at the FCA, said:
“Big Data is having an ever-growing social and commercial impact, and has the potential to transform practices and products across financial services. We are starting our work on Big Data by seeking to better understand how insurance firms are using data, and how this may evolve in the future.
“We are keen to talk to both consumers and industry to understand Big Data’s impact on firms’ decisions, and in turn the effects that this is having on consumers. We will then be able to consider what further steps may need to be taken.”
Although the use of Big Data is developing across financial services, the FCA will focus on retail general insurance. This reflects how extensively data is already used in the sector and the significance of the sector for consumers.
The Call for Inputs will focus on three key topics:
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does Big Data affect consumer outcomes?
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does Big Data foster or constrain competition?
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does the FCA’s regulatory framework affect developments in Big Data in retail general insurance?
In looking at consumer outcomes, the FCA is also interested in how Big Data might affect consumers who may not be able to access standard insurance products, including those with disabilities or other vulnerabilities.
The Call for Inputs will close on the 8 January 2016. The FCA will be meeting with firms, consumer groups, industry bodies and other interested parties, and seeking data from firms from December 2015 to early 2016 to help inform any next steps.
The FCA will use the findings from this Call for Inputs to determine its next steps, including whether a market study, adjustments to policy or guidance, or any other form of intervention, is appropriate. The FCA will publish a Feedback Statement mid-2016 detailing the findings from the Call for Inputs and any necessary next steps.
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