FSA calls for reform in the insurance industry
Speaking in New York John Tiner, FSA Chief Executive, told his audience that the FSA wants to see the end of the practice of “deal now, detail later”, which has led to estimates of several hundred thousand outstanding policy wordings across the insurance market. This lack of certainty at the time of signing commercial contracts creates risk for policyholders, insurers and brokers.
He added: “As the FSA prepares to take on regulatory responsibility for insurance mediation, we challenge the London Market – the underwriters, the brokers, the infrastructure providers and the clients – to develop and execute as rapidly as is possible a market based solution to this issue of contract certainty. Consistent with our philosophy of working with the grain of the market, the FSA wants to see the insurance industry grasping this nettle and moving to a business and operating model which is transparent and efficient.”
John Tiner has invited a number of key insurance industry personnel to meet with him to discuss the issue. The FSA will look to industry to take the lead role in delivering solutions within the next two years.