The Financial Conduct Authority aims to reduce regulatory pressure on insurers working with big companies while maintaining protection for smaller clients.
New Rules Target Simplified Insurance for Large Corporates
The UK’s Financial Conduct Authority (FCA) plans to relax rules for insurers that sell policies to large companies. This is part of a wider push by regulators to support economic growth. The proposed changes will help insurers deal more efficiently with large clients, who are considered capable of managing risks on their own.
Support for Big Business, Protection for Smaller Firms
In a statement, the FCA said the goal is to reduce burdens for insurers working with large businesses, while still ensuring strong protection for smaller firms that need more support. The move marks a shift towards a more practical approach in regulation.
London Insurance Market a Global Leader
London is home to the world’s largest insurance hub for commercial and specialty risks. The market generates over $91 billion in annual premiums, based on data from Lloyd’s of London.
Government Pushes Regulators to Focus on Growth
Since the Labour government took office in July 2024, it has urged regulators to stop being overly cautious and instead help drive the economy. FCA Chief Executive Nikhil Rathi, reappointed in April, pledged to prioritize economic growth in the coming years.
Key Proposed Changes by the FCA
- Insurers would no longer be required to review product value every 12 months. Instead, reviews would be based on product risk and features.
- Firms could appoint one lead insurer to meet regulatory requirements when multiple parties are involved in designing a policy.
- Annual reporting and employer’s liability notice rules that are seen as repetitive could be removed.
- The current minimum training hours for insurance employees could be dropped.
- Some rules may apply only to customers based in the UK, limiting unnecessary scope.
Feedback Period Open Until July 2
The FCA has invited feedback from the insurance industry on its proposed changes. The deadline for submitting comments is July 2.
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