What to expect from the regulator in 2025
In the first Insurance Post Podcast of 2025, regulatory experts reveal whether the Financial Conduct Authority will become a pricing regulator and slim down the rule book in the year ahead.
Matthew Connell, director of policy and public affairs at the Chartered Insurance Institute, Mathew Rutter, regulatory partner at DAC Beachcroft, Hugh Savill, senior adviser at Sicsic Advisory, and Huw Evans, head of insurance at KPMG, discussed whether the watchdogs will please Labour chancellor Rachel Reeves who wants them to strip away red tape.
The compliance experts consider whether reporting requirements could change, what a policy statement on non-financial misconduct is likely to contain, if the Consumer Duty rules could be amended plus what approach the watchdog will take to tackling premium finance.
Connell said he expects the regulator will intervene where it sees cross subsidies that it doesn’t feel are right.
He said: “There are thin margins on motor insurance, but if you get a situation where the winners are people who shop around for the best rate on premium finance and the losers end up with a higher rate because they trusted their insurer, that is a bad place to be.
“The regulator will feel they have a genuine public mandate to intervene.”
Reflecting on what could be the outcome of the Labour government’s motor insurance taskforce, Evans said the irony of the group is they are examining what is pushing up premiums when prices are coming down.
He said: “There is a wider problem with premium finance, which the regulator has not got their arms around which is access to credit for people on lower incomes.”
On the Prudential Regulation Authority’s workload, the group expects the watchdog to focus on the life side of the insurance market this year, plus solvent exit plans.
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