R0 Exams: technical changes

r0 exams technical changes

R0 Exams: technical changes

If you are sitting the CII’s R0 exams, there are some technical changes that you need to be aware of that have been (or will be) introduced from April 2019. These impact on the R01, R02 and R04 exams.

FSCS increase in compensation limits

The Financial Services Compensation Scheme (FSCS) pays compensation claims made against authorised firms that are unable to meet these claims due to insolvency or having ceased trading.

Tested: from 1.4.19

R0 exams affected: R01 and R02

What’s changed? From the 1st April 2019, the FSCS limits have changed as follows:

The compensation limit has been increased from £50,000 to £85,000 (the same as the cash compensation limit) for the following types of authorised firms:

Investment provision (fund managers)

Investment intermediation (e.g. IFAs)

Life and pensions intermediation

Home finance intermediation (mortgage brokers)

Long term care insurance – the limit has changed from £50,000 to 100% of the claim

FOS – increase to binding awards and changes to the definition of eligible complainants

The Financial Ombudsman Service or FOS deals with unresolved complains from eligible complainants.

Tested: from 1.5.19

R0 exams affected: R01, R02 and R04

What’s changed? For complaints about firms made after 1.4.19, the maximum FOS binding award has changed from £150,000 to £350,000.

For actions or omissions made by firms pre-1.4.19 (but received post-1.4.19), the limit rises from £150,000 to £160,000.

For actions or omissions made by firms pre-1.4.19 and received before this date, there is no change (still £150,000).

In all cases, the maximum compensation amount can also includes interest plus costs plus interest on costs.

In addition, the definition of eligible complainant has changed. The broad intention is to make FOS available to a wider range of people and organisations. Specifically, the definition of a:

qualifying charity has risen up to £6.5M

trustee of a trust with assets has risen up to £5M

small business is now defined as one with an annual turnover of up to £6.5M, and has fewer than 50 employees or a balance sheet of less than £5M

consumer buy-to-let consumers and guarantors are now included

Single Financial Guidance Body (SFGB)

This provides information, debt advice, money guidance and pensions guidance to consumers.

Tested: from 1.9.19

R0 exams affected: R01 and R04

What’s changed? Quite a lot! In January 2019, the SFGB replaced three previous organisations that provide financial guidance: Pensions Wise, The Pensions Advisory Service and Money Advice Service.

Click here for further details of SFGB

If you are sitting your R0 exam before 31st August 2019, you will be tested on the previous three bodies. See the CII website for your R0 exam to see confirmation of the technical changes on the web update for each exam.

Click here for details of our unique audio material

Hope this helps. As always, prepare well.

The Diploma Doctor

wwwr0exams