The Association of British Insurers, the British Bankers' Association and the Building Societies Association have announced the ‘simple product' framework has been approved by the Trading Standards Institute (TSI).
This is in line with the recommendations set out in the Sergeant Review (during March 2013) which made the case for Simple Products - a suite of financial services including protection products - with standardised features that are easy to understand and transparent.
Helen White, head of protection at the ABI (pictured), said:"The Sergeant Review showed that some customers would benefit from simple and easy to understand savings and protection products that meet their essential needs and that they can trust. Receiving the approval for our simple product Framework gives consumers confidence that they can purchase a financial services product in a straightforward way."
The framework is approved independently by Trading Standards Institute (TSI) Consumer Codes Approval Scheme (CCAS) board.
CCAS aims to reduce consumer detriment by developing a stringent series of guidelines businesses voluntarily adhere to. Businesses are only approved if they clearly demonstrate that they are following code guidelines.
Citizens Advice, Financial Services Consumer Panel, Macmillan and the Money Advice Service have agreed to sit on the simple products steering board.
The board will oversee the standard, framework and accreditation of a suite of simple products. These products should offer consumers a straightforward benchmark that gives them the confidence to make good decisions.
Product providers will be able to apply for accreditation in Q1 2015.
Baroness Christine Crawley of Edgbaston, chair of the CCAS board, said:"We are delighted to welcome the simple products codes of practice into our family of consumer codes, a hallmark for excellent consumer protection and customer service.
"Not only does the simple products code help financial institutions distinguish their products from those of competitors, it gives peace of mind to consumers that if something goes wrong, they will be dealt with fairly and transparently by businesses under the terms of the scheme."
"We want consumers to further recognise that a business showing an approved code logo is a business they can trust."
Peter Tyler, policy director at the BBA, said:"Customers expect and deserve financial products that do exactly what they say on the tin. A suite of Simple Products will make it easier than ever before to understand whether a saving or insurance product is right for you. TSI accreditation of our simple products framework provides independent assurance that simple products are fit for purpose."
