FG21/1 at file level: the vulnerability documentation checklist
The most common gap when a suitability report is scored against FG21/1 is not a wrong vulnerability decision — it is a missing one.
No line saying vulnerability was considered and ruled out. No record of the characteristics that were checked. The thinking never makes it into the file — so as far as any reviewer can tell, it never happened.
What the FCA says: FG21/1 and the Consumer Duty
FG21/1, the FCA's finalised guidance on the fair treatment of vulnerable customers, sets out how firms should assess and respond to characteristics of vulnerability — guidance the firm is expected to work from. It sits alongside the Consumer Duty's expectation that firms act to deliver good outcomes for vulnerable customers, set out on the FCA's Consumer Duty pages with firm-level examples in the Consumer Duty publications library.
At file level the test is documentation: what was considered, what was found, and what changed because of it. The FCA's Enforcement Watch series keeps returning to the same failure — the judgement that never made it into the file.
The four things a file must show
Characteristics checked
The four drivers of vulnerability — health, life events, resilience, capability — are each considered and recorded.
Outcome
Whether indicators were identified or ruled out. A conclusion, not an omission.
Reasoning
Why the conclusion was reached, grounded in the client's stated circumstances.
Mitigations
If indicators were identified, the adjustments made — communication, charges, reviews, or suitability changes.
Worked example: the checkbox and the paragraph
The same client, two records. Anonymised and illustrative.
Before
“Not vulnerable” — a single line with no drivers listed, no reasoning, and no record that any check happened. As far as a reviewer can tell, the conclusion came from nowhere.
After
“Characteristics checked — health, life events, resilience, capability. Outcome: resilience indicators present following [event]. Reasoning: income gap identified; capacity to absorb loss reduced. Mitigations: timeline extended, fees spread, a named contact. To be reassessed at the next review.” Four items, four lines, complete.
Common mistakes when using the checklist
- The bare denial. A conclusion with no characteristics, no reasoning, and no record of the check.
- The outcome without the consideration. Recording the result while the audit trail of what was checked stays blank.
- Mitigations without a label. Adjustments made in conversation and never written into the file, so the response is invisible.
- The one-time pass. Vulnerability is re-checked when triggers appear and at review time — not frozen at the point of sale.
The checklist as a scoring grid
| Item | What passes | What fails |
|---|---|---|
| Characteristics checked | Drivers listed and considered for the client. | Nothing recorded, or a tick with no content. |
| Outcome | A clear identified or ruled-out conclusion. | No outcome, or an omission in its place. |
| Reasoning | Grounded in the client's stated circumstances. | An assertion with no basis in the file. |
| Mitigations | Adjustments recorded where indicators were found. | Flag present, response nowhere. |
Related reads
This checklist is the scoring grid for the vulnerable customers hub. Write the outcome with the one-paragraph documentation wording and apply the per-file adjustment checklist when indicators are found.
Frequently asked questions
Is a blank “not vulnerable” line enough?
No. The line must show the check that led to the conclusion — the characteristics considered and the reasoning. “Considered and ruled out” is evidence; a bare denial is an assertion.
What if indicators are found?
Record the outcome and the mitigations, and make the adjustments the drivers call for — communication, charges, reviews, or suitability changes. The file shows the response, not just the label.
Who signs the checklist?
The adviser authors it; a reviewer or the principal checks it at review time. The signature line is part of the evidence — it shows the assessment was seen and confirmed.
Your next step
Score one recent suitability file against the four items — checked, outcome, reasoning, mitigations — and fix what is missing. In file-review terms it is the cheapest fix in the world: one paragraph. Considered, checked, ruled out, because. Start a free trial or see pricing.