House of Lords officially opens inquiry into commercial insurance regulation

The UK parliament’s House of Lords Industry and Regulators Committee is officially opening its inquiry into the regulation of the commercial insurance and reinsurance industry today.

The inquiry aims to “explore the extent to which regulatory policy is well-designed and proportionately applied, and the possibilities for optimising policy following Brexit.”

Aside from assessing the roles of the Bank of England and Financial Conduct Authority (FCA), it will also look into the effect of regulation on customers and the overall market’s global competitiveness.

The first evidence session will comprise industry representatives Christopher Croft, chief executive officer of the London and International Insurance Brokers’ Association (LIIBA) and Caroline Wagstaff, chief executive officer of London Market Group: both regular Insurance Business columnists.

Primarily, the Committee will ask them how they see the future of commercial insurance and reinsurance regulation. Other questions the Committee will cover with the witnesses include:

• The size and significance of the insurance and reinsurance market relative to the wider UK financial sector.
• Whether regulation of the industry in the UK is proportionate and how it can be improved.
• Whether UK regulation in the sector encourages or discourages innovation.
• Given the influence of Solvency II on worldwide insurance regulation is the UK, despite Brexit, still largely dependent on EU regulation policy in setting the climate for insurance regulation in this country? Would the insurance industry like to see regulation in the UK move away from policies in the EU?
• Whether regulation has caused insurers to base themselves outside the UK and whether a requirement on regulators to support UK competitiveness in the international insurance market would be of benefit.

The Committee invites written evidence from industry participants, organisations, and interested parties, which can be submitted to the UK parliament’s official website on or before February 11.