On 1 April 2019, we became the regulator of claims management companies (CMCs). Learn about regulation and activities needing FCA approval.
On this page
The focus of our regulation of claims management companies is on driving up standards of conduct and boosting consumer protection. We want CMCs to be trusted providers of high quality, good value services that help people pursue legitimate claims for redress.
We have 3 main areas of focus:
- Customers – We want customers to be empowered and confident in choosing a value-for-money service which is appropriate for their needs.
- CMCs – We want CMCs to help customers secure redress in a way that complies with our rules and be authorised so that they meet a common set of standards.
- Regulatory – We want to regulate in a way which prioritises high standards of conduct and improves public confidence in claims management services.
There is a significant shift in the kind of regulation firms will now face. Under the FCA, there will be some rules and requirements that will be similar to the former regulator’s rules and requirements.
About the FCA regime
It is important to make sure your firm can meet and maintain our standards, and is able to cope with the changes. This will be necessary whether you have been authorised for a long time, or whether you are entering regulation for the first time (eg, firms operating solely in Scotland, or firms who solely handle claims in relation to Section 75 of the Consumer Credit Act). There are several elements to the FCA’s regime that you need to be familiar with. These are explained in more detail:
Entering FCA regulation
- temporary permission
- firms entering claims management regulation for the first time
- fees that CMCs will need to pay
- what happens after a firm is authorised
- complaints about CMCs
Firms previously regulated by CMR
CMCs previously regulated by the CMR, and that wished to continue trading, had to register for temporary permission by 31 March 2019. Firms that registered must now apply for authorisation in 1 of 2 application periods. See our authorisation page to find out more.
The laws that were created to transfer regulation of claims management to the FCA also made some changes to which firms are regulated. This means some firms will be entering regulation for the first time. This mostly relates to:
- firms that are incorporated in Scotland, and only serve Scottish customers, or
- firms that only handle claims about Section 75 of the Consumer Credit Act 1974
These firms had to register with us for temporary permission to continue operating by 31 March 2019.
They must now apply for authorisation in application period 1, which will be open from 1 April to 31 May 2019. This is when we will assess whether or not the firm meets our requirements and conduct standards.
- firms that wish to start claims management activity from 1 April 2019
These firms will need to submit their application to the the FCA, paying 1 application fee. This means that they must not perform any regulated activity until their application has been determined.