Product Governance – Product Reviews and Fair Value Assessment
Each year, Chubb now undertakes a review of its UK products in line with the requirements of the Financial Conduct Authority’s product governance rules, and our own product oversight and governance arrangements set out in Chubb’s Conduct Risk Framework, an overview of which is provided here.
The table, which is provided here sets out the products reviewed, the date of the most recent review, and the outcome of each review from a Fair Value perspective.
In addition, the table provides summary details of the main benefits provided by each product, the distribution strategy and the target market. This is provided to help distribution partners and brokers gain a high level view of the products Chubb provides and the intended market for each product.
In determining the fair value assessment outcomes, our reviews look at a range of factors, including:
- Nature and complexity of the product, and distribution strategy;
- Needs/objectives of the target market, and customer vulnerability factors;
- Product benefits, exclusions and charges that apply, if any (e.g., excesses);
- Pricing;
- Distributor remuneration paid by us;
- Aggregated broker/distribution partner remuneration feedback;
- A range of Conduct metrics including, cancellation data, complaints data, claims volumes/acceptance rates/average claims settlements and commercial performance.
In Q2 2022, Chubb issued a communication to all our distribution and broker partners to establish whether any additional customer charges are applied by broker partners in relation to Chubb policies that, in addition to the premium set by Chubb, could influence value in the product, and the end price the customer pays. The aggregated feedback from that exercise informed relevant product reviews.
Individual broker portfolio performance
As our products are distributed through a range of partners and brokers, product performance for a given product is measured at an overall aggregated level and not at individual partner/broker level. Similarly, where products have a comparable risk profile, these too have been aggregated and assessed together as a single product group.