The Financial Services Authority (FSA) has called for the health insurance industry to help it form a regulatory code across the “broad church” of products to stop “financial crime”.
Speaking at the Health Insurance Conference in London, Justin Musson, an associate for the insurance firms division at the FSA, said the changes in the FSA’s internal organisation mean more cross-fertilisation of supervisory ideas within the finance sector.
The watchdog said it will tailor its regulatory activities through research within the industry.
The statutory objectives of the Financial Services Markets Act (2000) are to maintain confidence in the financial system and to reduce financial crime.
It also aims to promote understanding among consumers and to ensure they are protected.
Musson said: “The FSA approach is not to be dictatorial but to have more openness and sharing of ideas. We want to build co-operation with firms and tailor an approach depending on the type of firm.”
In response to the FSA comments, Kate Bleuel, the head of health and risk consulting at employee benefits consultancy Towers Perrin, said: “The industry wants light touch regulation.
“Private medical insurance is sorted in terms of regulation through the General Insurance Standards Council. I think the focus should be more on life insurance because that could be subject to misselling.”