Podcast: What regulators have in store for insurers and brokers

During the podcast, titled What regulators have in store for insurers and brokers, Sicsic said given the spat between the government and Prudential Regulation Authority on the risk of ditching the EU’s Solvency II capital requirements, he wouldn’t expect a massive overhaul of the rules.

Sicsic, who spent four years at the Financial Conduct Authority as head of supervision for the general insurance retail sector, said: “I am sure I will disappoint a lot of people, but I don’t expect the end of Solvency II this year. I expect a rebadge of Solvency II to something more local.

“There will be a dividend, clearly, so it will be Solvency UK – or the acronym Suk. Is it a relaxing of some rules without going into technicalities? I think the impact for general insurers is relatively limited. Most of the impact will be on life insurers.

“I think the dividend will be the investment and flexibility it gives for large life insurers to be able to invest in some infrastructure projects in the UK. I think there are still a lot of questions around how the PRA will supervise going forward.”

I think the impact for general insurers is relatively limited. Most of the impact will be on life insurers.

Michael Sicsic

Clare Lebecq, group chief operating officer of Specialist Risk Group, said the more the UK’s regulatory requirements for general insurers diverge away from the European Union’s rulebook, the more any future convergence becomes problematic.

She said hopefully a shake-up of Solvency II will allow the industry to support sustainable finance and investment in greener energy.

Given the government’s desire to deliver a Brexit dividend this year, Lebecq said she expects the PRA to change capital requirements this year.

She said: “There was never a desire from anybody to have a wholesale bonfire of Solvency II rules, because at the end of the day it took a lot of time, effort and a huge amount of investment to implement it.”

In the podcast, which also featured Mike Keating, CEO of the Managing General Agents' Association, the trio explained the latest diversity and inclusion rules, plus the regulator’s requirements for the environmental, social and governance approach taken by the industry.

They also explained what insurance providers and brokers need to do today to meet the Consumer Duty deadline, as well as the ongoing activity that is essential to companies that want to continue to meet requirements.

What insurers can do to stay on the right side of evolving regulation and how they can learn to use compliance to their advantage is also covered by the three guests.

As well as being able to listen to the podcast by clicking on the player above, you can also download and keep this episode of the Insurance Post Podcast to listen to anytime, anywhere you want to. To download the episode, go to your podcast provider of choice (Apple, Google, Samsung, Spotify, Audible, etc) and search for Insurance Post.