A year after a government review called for the elimination of confusing tricks and gimmicks on the high street, the first product to pass the simplicity test is being launched. Barclays have created a BSI-approved life insurance policy – the first of its kind, however rival banks are expected to follow suit.
The Sergeant Review requested a range of simple savings accounts and life cover, saying that products must be “clear, straightforward and standardised” in order to be awarded a BSI Kitemark. It is hoped that this mark of approval will send out a reassuring message to consumers.
“The BSI certification process will ensure that they do what they say on the tin and the BSI Kitemark will be available to any financial services company that meets the standards.” – Carol Sergeant.
The treasury set up the review back in 2012 in response to concerns that few people were doing anything to protect themselves financially. Ms Sergeant pointed out that a key issue is that people are often bewildered by the range of saving products and all the different prices on offer.
This view has been backed by research published recently by the consumer group Which?. The research revealed poor practices in the savings market that distort the competition and confuse people regarding the returns on their savings.
Which? has called for the Financial Conduct Authority to eliminate these practices to change the savings market for good. BSI-approved accounts look to achieve this aim. Simple, easy to understand savings accounts will be more popular, so financial institutions will be forced to think differently.
Catherine McGrath of Barclays Personal Banking commented on the launch of their BSI-approved life insurance policy, saying it is an important step forward within the industry and that Barclays are keen to drive simplicity across their entire product range.
Other banks are rumoured to be launching similar products soon, so it looks as though a simpler way to bank could be just around the corner.