Bereavement support under scrutiny for investment firms
When a customer loses a loved one, how their financial services provider responds can define trust
01/06/26
Read more
Bereavement support under scrutiny for investment firms
When a customer loses a loved one, how their financial services provider responds can define trust at a pivotal moment and impact their long term well being. Earlier this month, the FCA announced a review into whether consumer investment firms are doing enough to support bereaved customers. With fewer than half of bereaved customers (47%) feeling they received the support they needed, standards need to improve.
This is not simply about service delivery. It is a clear indication that outcomes for vulnerable customers must now be evidenced in practice, not just described in policy.
A natural extension of maturing Consumer Duty scrutiny
The FCA’s focus on bereavement support sits squarely within the broader evolution of Consumer Duty supervision. As Consumer Duty supervision matures, the focus has moved beyond initial implementation. Year three is no longer about demonstrating effort – it is about proving effectiveness.
In 2024, the FCA published the findings of a multi-firm review of life insurer’s bereavement claims processes, to check that firms were meeting Consumer Duty expectations, and a multi-firm review of the treatment of vulnerable customers in retail banking. In those reviews, the FCA concluded that while some insurers were making good process changes, action was needed to improve the customer experience and remove unnecessary friction that adds to customer distress and impacts their financial well being. The FCA said it wanted to see a “step change” improvement and that “No firm can afford to be complacent in this area”.
Findings of our multi-firm review of life insurers’ bereavement claim process | FCA
Bereavement as a test of culture and outcomes
The FCA’s review will assess how firms handle the customer experience from the point a bereavement is notified through to the settlement or transfer of investments. This includes how firms communicate, how they support vulnerable customers, their service standards and how fees are applied on bereaved accounts.
As the FCA has made clear, these processes are a real test of a firm’s culture. Poorly designed journeys (characterised by unclear letters, repeated requests for information and avoidable delays) risk compounding distress at an already difficult time. Well-designed journeys by contrast demonstrate that customer-centricity is genuinely embedded. Actions speak louder than words, and the FCA will be looking for firms to evidence that they are making real and meaningful improvements
How this fits with the FCA’s wider supervisory direction
This review should also be read in the context of the FCA’s wider priorities. In its 2026/27 work programme, the regulator signalled a more outcomes-focused approach underpinned by the Consumer Duty. Vulnerable customers, fair value and customer understanding are now core supervisory points not secondary considerations.
Similarly, the FCA has been explicit that its sector regulatory priority reports are intended to guide boards and executive teams. For consumer investments, building trust and securing good outcomes sit at the heart of that agenda. The bereavement review is an early and practical application of those priorities.
What this means for boards and executive teams
For boards, this review reinforces that vulnerability and customer support are governance issues. Bereavement support cannot sit solely with operations or customer service teams. Boards should expect to understand how these journeys work, how outcomes are measured and where risks or weaknesses exist. Boards would also be expected to demonstrate what action has been taken to improve practices in light of previous FCA reviews and publication of best practice.
If selected for review, firms will be expected to evidence how effectively they support bereaved customers. That means being able to demonstrate not only that a process exists but that it works, including:
- how quickly cases are resolved
- where delays arise
- what feedback customers provide
- what changes have been made where outcomes fall short
This is as much about learning and improvement as it is about compliance.
What ‘good’ increasingly looks like
While approaches will differ across firms, clear themes are emerging around good practice. Stronger firms tend to design bereavement journeys around clarity, empathy and speed. That often includes simple, jargon-free communications, a single point of contact to reduce repetition, streamlined information requests and proactive consideration of fees during the bereavement process.
Equally important is how staff are supported and trained to handle these cases sensitively and how firms monitor interactions to identify friction or unintended harm. In short, bereavement cases are treated not as transactions to be processed but as people to be supported.
Looking ahead
The FCA’s bereavement review is best understood as a marker of where Consumer Duty supervision is heading. The regulator is increasingly testing firms against real customer experiences rather than abstract frameworks. Bereavement will not be the last journey to face this level of scrutiny.
For investment and advice firms the regulatory emphasis is shifting. Policies and intentions matter but evidence of outcomes matter more. Firms that can demonstrate that they support customers effectively at their most vulnerable moments will be better placed as supervisory expectations continue to rise.
We’re supporting firms that are taking a closer look at how effectively their Consumer Duty frameworks operate in practice, particularly for vulnerable customer journeys such as bereavement. TCC independently reviews and tests these journeys end‑to‑end, helping firms assess whether governance, processes, data and outcomes stand up to regulatory scrutiny. From board level challenge and outcomes assurance through to targeted reviews of customer support models and evidence of effectiveness, we help firms move beyond policy intent to demonstrable, regulator ready outcomes. Get in touch to discover how we can help your firm.