A recording is available to watch here: Parliamentlive.tv - Financial Services Regulation Committee.
Chris Lay, CEO of Marsh McLennan UK and of Marsh in the UK opening comments below:
• There are many reasons for the success of the UK Insurance Market, not least the capital that can be accessed here, but also because of the regulatory environment that has been established over many decades.
• This may sound surprising, since the perception the industry can at times come across as opposing all regulation because it gets in the way of business.
• The truth is in fact the opposite. We welcome regulation that supports consumers and ensures the integrity and stability of the UK financial system. We welcome stable, proportionate and agile regulation.
• The issue is that in recent years we have seen regulation designed to protect consumers and the most vulnerable in society – regulation that we support – introduced in a disproportionate way, applying it to not only consumers but also businesses. The needs of consumers are very different to business that are usually more sophisticated and have access to considerable information and advice.
• According to our trade association BIBA, and research undertaken by London Economics, the result of this disproportionate application of regulation has been a 40% increase in direct regulatory cost for brokers between 2019-23 and now more than 4-5x as high relative to the 21 other jurisdictions covered in their research.
• We see this on a day-to-day basis where we find ourselves being regulated not for the size of the risk we pose to financial system, but by the overall size of our business. This is relevant when we consider that Insurance Brokers and intermediaries do not represent a systemic risk to stability of the UK financial service markets.
• We welcome the recent publication of the FCA and PRA’s competitiveness reports and the warm words, and we look forward to exploring what actions can be taken to ensure the implementation of their new secondary objectives continues to improve with the right mindset and culture. We cannot succeed in growing the economy without making sure we have a competitive regulatory regime.
• This is not about a race to the bottom, but an opportunity to do things better, so that consumers get the outcomes they need while businesses that we work with get the right outcomes they need to continue to thrive and grow.
|
