The Tories yesterday revealed plans to scrap the FSA, passing regulation of large institutions, such as banks, building societies and insurers to the Bank of England. Regulation of IFAs, mortgage brokers and insurance brokers would pass to a new body called the Consumer Protection Agency.
ABI director general Stephen Haddrill says: “The key issue for insurers, whoever supervises them, is that insurance is not treated like banking. We must remember that regulation has worked better for insurers than for bankers.”
Haddrill says the ABI supports the Conservatives’ proposal for a Financial Policy Committee working within the Bank of England and including independent experts.
He says the regulatory framework must address the overlap and underlap in responsibilities between agencies, as well as addressing a lack of communication.
Haddrill says: “There will be aspects of regulation coming out of Brussels and the international arena that will not fit neatly into whatever regulatory structure the UK adopts, making better communication and co-ordination even more vital.”