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Life insurance reforms to go ahead

Date: Thu, 26 Jun 03 Analysis

The Financial Services Authority has published a policy statement detailing the timetable of implementation for its plans to reform the governance of life insurance companies.

Included in the statement are proposals to increase the transparency of decisions related to the use of discretion in with-profits funds and plans to make directors and senior management of life insurers explicitly responsible for all decisions of their business.

The FSA believes the proposals will bring advantages to life companies by clarifying the responsibilities of boards and senior managers.

John Tiner, FSA managing director for insurance, commented: 'These measures will benefit with-profits and other policyholders by making more transparent how discretion in with-profits funds is exercised by boards and senior management, bringing policyholder liabilities within the scope of the audit, and introducing a public actuarial opinion to be published with the audit report.

Firms will have to comply with the new policies regarding changes in governance arrangements and reporting to with-profits policyholders by March 2004.

'This new governance approach is closely linked to the implementation of the proposed new reporting system for life insurers, on which we are making good progress,' Mr Tiner added.

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Endsleigh Insurance Services Limited is authorised and regulated by the Financial Services Authority. This can be checked on the FSA Register by visiting its web site at www.fsa.gov.uk/register.
Endsleigh Insurance Services Limited. Company No: 856706 registered in England at Shurdington Road, Cheltenham Spa, Gloucestershire GL51 4UE.