Customer vulnerability management checklist
Every firm is on a unique journey with its customer vulnerability management strategy, which translates into different levels of operational maturity. This checklist should quickly pinpoint areas for enhancement and support the assessment of current capabilities against good practice.
This checklist was created in partnership with, and published by, the Chartered Insurance Institute; reproduced with permission.
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Strategy, governance and culture
Target market analysis: clearly defined and quantified characteristics and scale of vulnerabilities and their impact or consequences (for example, the potential harms) that the customer base and target market face.
Policy: a policy which defines the data needed, where it is stored, how it is kept both accurate and consistent, and when it is to be deleted (all in accordance with UK GDPR).
Product design: product design, approval and review processes consider the needs of vulnerable customers in order to prevent foreseeable harms and ensure fair value.
Systems and processes: systems and processes manage the data required for customer vulnerability management.
Staff training: training ensures that all relevant staff (from front-line teams to product teams and senior leadership) are trained, empowered, competent and confident to understand the needs of, and support of, customers in vulnerable circumstances.
Culture: led by senior management and the board, firms can evidence an organisation-wide culture which prioritises delivering good outcomes for vulnerable customers.
Identification and recording
Proactive identification: proactive processes identify customer vulnerabilities across the entire customer journey, rather than rely solely on customer disclosure at any single point (for example, claims or complaints stages).
Holistic assessment: assessments cover the full range of vulnerability drivers (e.g. health, life events, low resilience, low capability etc.) and their potential to intersect with other vulnerabilities (not just financial vulnerabilities).
Consistent recording: a taxonomy to consistently record all vulnerability related data and its potential impact.
Protected characteristics: systems that allow firms to monitor outcomes for customers with protected characteristics, in line with the Equality Act 2010.
Action and support
Tailored support: firms can demonstrate how they use customer vulnerability data to provide tailored support and inform product design.
Consumer understanding: firms should test and adapt customer journeys to ensure that those customers with diverse needs can easily navigate them.
Accessible journeys: firms have review and. remove unnecessary friction (‘sludge’) in customer processes that create barriers or harm for vulnerable customers.
Monitoring, reporting and assurance
Quality data and evidence: a data architecture that delivers consistent data and allows firms to evidence the steps taken, and the outcomes achieved, to accommodate each customer over the lifetime of products and services.
Outcomes monitoring: firms can report on the outcomes experienced by vulnerable customers compared to non-vulnerable ones in Consumer Duty Board reports – and can compare outcomes between different cohorts of vulnerable customers (for example, those experiencing a specific negative life event, who have a type of low resilience) and between a specific cohort of vulnerable customers and non-vulnerable ones.
Assurance and testing: a regular assurance programme (for example, call monitoring, case file reviews or mystery shopping) can test whether vulnerability policies are followed in practice.
Distribution chain oversight: monitoring and governance extends across the entire distribution chain to evidence good outcomes across it (this requires data sharing).
