Overview
Promoting, arranging, or providing insurance are regulated activities and the provider must be authorised by the FCA. It is a criminal offence to sell, advise on, or administer general insurance contracts without being FCA registered.
Providing a payment scheme without an insurance element is unlikely to require FCA authorisation but you may fall within the scope of insurance regulation if you are involved in selling or setting up insurance policies. You cannot rely on not being a professional insurance provider or insurance broker to exclude you from the FCA’s rules.
How you set up your scheme may take you outside the scope of regulations, but you should always seek advice from your solicitor or accountant to ensure that you do not inadvertently fall foul of the requirements.
Insurance status of private dental plans
The type of dental plan you want to set up will determine the need to comply with the FCA requirements:
- Capitation or maintenance-style plans do not amount to an insurance contract
- Accidental trauma and worldwide emergency insurance is a form of insurance contract. If included as an adjunct to a plan and not administered separately,
the scheme in its entirety is deemed to be a form of insurance - Dental insurance, implant insurance, and general medical insurance schemes with a dental component are insurance contracts.
- If your plan does not include accident or emergency insurance, you are not affected by the FCA insurance requirements (although you may need FCA consumer credit authorisation). If a capitation or maintenance plan includes the option of insurance, you must not recommend, advise or arrange the insurance. If the plan is only available with insurance, avoid offering it unless you adopt one of the options outlined below.
You do not need FCA authorisation to provide treatment to a patient covered by an insurance-based plan and claim the treatment-cost from the insurance provider.
Your options
Depending on whether you offer the option of accidental trauma and/or worldwide emergency insurance cover provided by a third party as part of a capitation-based plan; or a private dental insurance scheme or general private medical insurance with a dental component (Simply Health), you have various options:
- Not to offer accidental trauma insurance cover (capitation scheme) or general dental insurance cover
- Limit your activity to providing information about accidental trauma insurance (capitation scheme) or dental insurance products. Advise patients to apply directly to a plan provider or insurer
- Act as a block policyholder of accidental trauma insurance (capitation scheme). This relies on the wording of the policy contract, so check with the plan provider or insurer that their policy meets relevant FCA requirements
- Make sure that you are not involved with a capitation plan or insurance by way of business. The terms must allow a plan member or policy holder to seek treatment from any dentist, not just you
- Continue to advise on, recommend and/or arrange insurance cover and become FCA authorised or an Appointed Representative of an authorised firm and comply with the FCA’s requirements.
