The industry treats Consumer Duty as a compliance cost. Handled properly, it's the mechanism that makes a fairer, better-aligned claims model possible — and a structural edge for UK-native players.
Ask most people in claims what Consumer Duty means to them and you'll get some version of "more paperwork". The FCA's regime — fair value, good outcomes, support for vulnerable customers, evidence for all of it — lands as an overhead: another thing to demonstrate, another report to produce, another cost on a line that's already under pressure.
We see it almost exactly the other way round. Consumer Duty isn't the tax on the model. It's the thing that makes a better model legitimate.
Claims has a structural conflict at its heart, and everyone in it knows it. The cost of a claim is the largest variable a carrier controls, and every party in the chain has an incentive that pulls against the customer at some point. In-house teams carry institutional pressure to manage indemnity. Legacy TPAs on cost-plus contracts have no particular incentive to police quantum, fraud or supplier discipline at all — they're paid to process, not to get the number right. The customer, at their worst moment, is the least-powerful party in the room.
The usual answer is to leave the conflict unspoken and hope oversight catches the worst of it. Consumer Duty makes that untenable. It requires you to demonstrate fair value and good outcomes — not assert them — with real-time data, plain communication and evidence per case. It turns "trust us" into "show us".
Here's the move most of the industry is missing. If you have to prove fair outcomes anyway — and you do — then the honest, aligned economics that were previously impossible to sell become possible.
Consider a savings-share model, where a claims partner is paid partly on the leakage they recover. The obvious objection is that it incentivises underpaying claimants. It's a fair objection, and under the old regime it was fatal, because there was no way to prove it wasn't happening.
Under Consumer Duty, with the data and evidence the regime demands, you can build the alignment in and make it auditable. You separate the two kinds of leakage — the recoverable kind (fraud, supplier overcharging, quantum cushioning, paying when you weren't liable), which doesn't reduce what a valid claimant receives, from underpayment of a valid claim, which is a breach, not a saving. You exclude the second from the fee contractually: no performance fee on any claim where a complaint is raised, a vulnerable customer is identified, a case enters the ombudsman or litigation, or a settlement falls below protocol. And you run an independent monitoring trail — complaint rates, ombudsman rates, time-to-settle, vulnerable-customer flags — on a metric that has nothing to do with the savings.
The result is a model where doing right by the customer and doing right by the carrier's P&L point the same way, and where a regulator can audit that they do. That's not compliance as overhead. That's compliance as the enabling condition for economics that were never available before.
The industry is treating the best thing that's happened to claims economics in a decade as a cost centre.
This is also where geography stops being incidental. Consumer Duty is a UK regime. The audit-trail requirement, the vulnerability obligations, the fair-value evidence — these are demands US-born challengers have no reason to have built for, because their home market doesn't ask for them. Retrofitting them later is the same problem as retrofitting AI onto a legacy core: they're architectural, not cosmetic.
A platform built in the UK, for the UK regime, from the start — with explainability, vulnerability detection and fair-value reporting native rather than bolted on — has a structural advantage that funding alone doesn't close. It's one of the few moats in this market that a better-capitalised overseas entrant can't simply buy their way past.
So we'd put it plainly. Consumer Duty is the regulator insisting on exactly the transparency that makes aligned, honest, better-for-everyone claims handling possible — and demanding it in a way that rewards whoever built for it first.
We intend to be that firm.
ADJST is building the AI-native TPA for UK motor, with Consumer-Duty-safe economics designed in from the start.