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Boards have responsibility for wp says KPMG

Ultimate responsibility for operating with-profits fairly and prudently is the responsibility of board directors says consultancy KPMG in its submission to the FSA&#39s review.

Ensuring fair treatment of consumers, transparency of policy terms and the soundness of a life office&#39s financial position must fall firmly at the doors of the boards, KPMG says.

With-profits life offices should be required for future policies to publish their methods for the smoothing of investment returns, the expenses charged to policyholders, the treatment of policies on surrender and how guarantees operate KPMG says.

KPMG head of insurance Richard Bennison says: “With-profits policies continue to have an important role to play in the UK savings market, but they need to become more open and transparent, and boards need to become more immediately accountable for them.”

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