Mazars call for proportionality in insurance reforms
International accountancy firm Mazars have called for a measured response to the proposed reforms of the insurance industry, arguing that the degree of systemic risk and size of the institution must be taken into account to allow insurers to manage the proposed reforms.
There is a wave of reform heading in the direction of the insurance sector, from the FSA, the Walker Report and a review of Basel II implementation from the Combined Code and the draft European guidance.
Mazars’ senior insurance partner Andrew Hubbard has warned of the dangers of the law of unintended consequences and stated that what is appropriate for major insurers may well not be suitable for smaller firms such as mutuals.
Hubbard went on to stress the importance of proportionality in the way the industry is regulated, adding that without it the sector could be at risk of losing competitiveness.
Mazars’ governance and corporate reporting partner Anthony Carey expressed his concerns regarding the recruitment of non-executive directors under proposed changes which would mean a move from director to chairman would require additional approval from the FSA, costing even more time.
Fears over the competitiveness of the British insurance industry have also been voiced by the ABI, which earlier this year urged the Government to create a friendlier business environment for insurers or risk losing some to rival economies.
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