Products and Services

Following on from our communication ‘What does the Consumer Duty Mean to our Customers, AXA, and our Brokers,’ below we concentrate on the first of the four Consumer Duty Outcomes - Products and Services.

Who is affected?

This outcome applies to firms which manufacture, co-manufacture, and distribute products and services, including brokers, other types of intermediaries and insurers. It covers existing products and services that are available to new customers or can be renewed by existing customers, as well as those which are new or have been significantly adapted.

As with Principle 12 and the cross-cutting rules, this Consumer Duty outcome covers consumers, individuals acting in a business capacity and SME customers. It doesn’t apply to reinsurance, contracts of large risk sold to commercial customers or other contracts of large risk where the risk is located outside the UK.

What is it?

The Products and Services outcome is central to firms acting to deliver good customer outcomes. By providing products and services which are fit for purpose, firms can avoid causing customer harm and will enable customers to pursue their own financial objectives. Relevant firms will need to:

  • Ensure the design of the product or service meets the needs, characteristics, and objectives of the defined target market
  • Ensure the distribution strategy is appropriate for the target market
  • Carry out regular product reviews to ensure that the needs, characteristics and objectives of the target customers continue to be met in practice

For co-manufacturer arrangements, roles and responsibilities should be documented in a written agreement.

This outcome is closely linked to the Price and Value outcome, because however a product or service is priced, it is unlikely to offer fair value if it is poorly designed or sold to customers who cannot use it.

Additional guidance on product governance and oversight can be found here.

What does this mean?

Below, we outline what this outcome means for AXA and the impact for customers and our broker partners across the lifetime of a product.

Key elements of this outcome AXA's role as Manufacturer* Customer Impact* Broker Impact*
Product Approval Process
  • We follow a product approval process for all new and significantly adapted products
  • Customers can have confidence that AXA products/services are designed to meet their needs
  • Customers should not be sold AXA products/services that are unsuitable for them
  • Customers with characteristics of vulnerability are considered at product design
  • You can have confidence that our products are designed to meet the needs of the target market
Defined target market
  • We have target market statements setting out the key features, benefits and exclusions for our products
  • We make clear any specific groups of customers who our products/services are not suitable for
  • We have processes to consider groups of customers with characteristics of vulnerability within our target market. Our staff are trained to identify vulnerability so that we can understand the needs of our target market
  • The product/service will not be sold to groups of customers who it is not designed for, avoiding potential harm
  • Customers with characteristics of vulnerability will be considered as part of the target market and processes will be in place to support them
Product testing
  • We test our products to ensure they are fit for purpose
  • We make any changes to ensure our products continue to meet the needs of the target markets
  • Testing will help to ensure that products are compatible with the needs of customers who purchase them
  • You can have confidence when selling our products and services that they are fit for purpose
Distribution strategy
  • We select appropriate distribution channels
  • We work with our selected partners and contracts will set out expectations
  • We work closely with our partners, sharing information and monitoring performance
  • Products/services will be sold to customers using appropriate channels
  • You will be equipped to understand our products/services, and how they should be distributed. This will help you to ensure that your own distribution strategy does not cause customer harm
  • Support your management of any conflicts of interest
Product reviews
  • We regularly review the performance of our products/services and the distribution arrangements, assessing a range of metrics through a customer lens
  • If we identify customer harm and need to make any product changes or remediate customers, we will let you know
  • Products and services will continue to meet customer needs, or will be amended if our product reviews indicate that needs are not being met fully
  • You may be asked to share information with us to help us complete our product reviews
  • You should let us know if you identify any issues that impact the target market or if your distribution arrangements for our products may have caused customer harm

**Examples are illustrative and not exhaustive

We believe that working closely together and sharing information will ensure the products and services that we design and sell continue to meet the needs of our customers. If you have any questions, please get in touch.