Let’s talk about CPD. Yes, we know no one loves squeezing continuous professional development (CPD) into their working week, but it is essential to maintain competence and stay up-to-date in our highly competitive industry.

As you’ll be aware, it is mandatory that financial advisers complete 35 hours of CPD annually. However, there is a common misconception that 15 of these must be entirely dedicated to insurance products. This is not the case.

The Insurance Distribution Directive (IDD) states advisers must undertake 15 hours of CPD a year. What many don’t realise is that if you have little or nothing to do with insurance products, this requirement can be met with minimal additional effort by covering a board range of topics that have a nominal focus on insurance.

How does this work? Well, many of the issues covered in general financial advice are also relevant to insurance. For example, understanding regulatory updates, ethical standards and market trends.

Your regulatory obligations

The 35-hour CPD requirement is in place to uphold the exacting standards expected of our profession. It aims to ensure you have the product understanding, skills and knowledge to provide top quality advice to clients.

CPD doesn’t have to be boring or tedious. It encompasses a wide range of activities, including workshops, webinars and courses, as well as reading industry publications. For advisers, particularly those focusing on investments and pensions, these activities should cover topics including retirement planning, tax regulations and compliance.

The IDD meanwhile focuses on enhancing consumer protection and ensuring insurance intermediaries possess adequate knowledge. It was introduced to provide minimum levels of competence in the insurance industry.

Therefore, if you are an insurance broker, your CPD should specifically address insurance products, market developments, regulatory changes and customer protection. By contrast, the 35-hour requirement for financial advisers is flexible. Through holistic planning, you can choose CPD activities that cover multiple aspects of your business.

For example, let’s say a financial adviser who focuses on investments and pensions attends a three-hour seminar on changes in both investment and insurance legislation. This would address the IDD topics and contribute to the individual’s broader regulatory knowledge needed for their 35-hours’ CPD.

Likewise, whilst primarily focusing on compliance and client protection, your annual anti-money laundering and complaints handling training overlaps significantly with the IDD requirements. Again, this means both aspects of CPD are covered.

Think strategically when planning CPD

Many professional bodies and training providers offer CPD that caters to financial and insurance advisory roles, so select your resources carefully to ensure you cover the required topics efficiently.

It is worth remembering that 21 of your 35 hours must be classed as ‘structured CPD,’ which means you must physically do something like attend a seminar or take a test or exam to evidence your learning. Each activity must last at least 30 minutes and cannot include research on products or services for a client.

Keeping detailed records of the training you undertake and how each activity meets different areas of your practise is essential to demonstrate compliance with all the regulatory requirements. When professional bodies such as the CII or CISI carry out audits (around 10% of members receive one each year), they often ask the adviser to add more information on their reflective learning statements.

Your CPD activity records should include:

  • Your development needs
  • The title of each activity you have undertaken
  • A description of the activity and the learning objectives
  • The CPD activity type
  • Whether the activity was structured or unstructured
  • The time recorded against each activity
  • The period of CPD activity
  • A reflective statement of your learning activity
  • Supporting evidence

You can choose to document your CPD in a format that suits you, but to assist advisers, most professional bodies have tools available to members that set out all the information you must provide and enable you to submit your record of activity online to save time.

In summary, if you only provide occasional insurance advice, you do not need to specifically complete 15-hours of CPD dedicated to insurance products. Through careful planning and documentation, you can meet the IDD requirement easily, simplifying your approach to CPD, whilst enhancing your overall expertise and the services you provide.

If you would like to know more about planning CPD or our bespoke T&C support, don’t hesitate to contact us on (0161) 521 8641 or email: info@b-compliant.co.uk

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