Product approval process

1. Manufacturers shall maintain, operate and review a product approval process for newly developed insurance products and for significant adaptations of existing insurance products. That process shall contain measures and procedures for designing, monitoring, reviewing and distributing insurance products, as well as for corrective action for insurance products that are detrimental to customers. The measures and procedures shall be proportionate to the level of complexity and the risks related to the products as well as the nature, scale and complexity of the relevant business of the manufacturer.

2. The product approval process shall be set out in a written document (‘product oversight and governance policy’), which shall be made available to the relevant staff.

3. The product approval process shall:

(a) ensure that the design of insurance products meets the following criteria:

(i) it takes into account the objectives, interests and characteristics of customers;

(ii) it does not adversely affect customers;

(iii) it prevents or mitigates customer detriment;

(b) support a proper management of conflicts of interest.

4. The manufacturers' body or structure responsible for the manufacturing of insurance products shall do all of the following:

(a) endorse and be ultimately responsible for establishing, implementing and reviewing the product approval process;

(b) continuously verify internal compliance with that process.

5. Manufacturers designating a third party to design products on their behalf shall remain fully responsible for compliance with the product approval process.

6. Manufacturers shall regularly review their product approval process to ensure that that process is still valid and up to date. They shall amend the product approval process where necessary.