FSA solvency levels bad for UK competition

The Financial Services Authority's suggested insurer solvency levels could leave UK insurers unable to compete against European companies, according to Pierre Lefevre, chairman and chief executive of Groupama.

Lefevre described the proposed system as "complex and burdensome" during the Drawing the Blueprint panel debate.

He added: "I am concerned about the CP 190 proposals, which I believe would undermine the competitiveness of the UK insurance industry. We are already seeing companies moving to Gibraltar."

Lefevre continued: "The FSA is also expecting smaller companies to have higher solvency, making it more difficult for them to set up, and potentially affecting competition within the UK."

- John Seaton underwriting director of Norwich Union Insurance: "It is about writing the right business at the right price and a focus on underwriting profit is not a bad thing. Brokers and policyholders want explanations and solutions when premiums rise. Investment income is declining and in order to take on these challenges we need the need the most capable underwriters."

- Michael Burnett president of the Chartered Institute of Loss Adjusters: "CILA and the CII are currently discussing bringing our conferences and the CII technician qualification together next year. It is sensible to bring the two qualifications together so that there is one clear examination path."

- Robert Hiscox chairman of Hiscox: "Insurance is perceived as dull but it is an exciting business. We are bookmakers and have to have fantastic judgement about the risk. It is a question of combining the new brain power coming into the industry with traditional good instincts."

- Martin J Sullivan vice-chairman and co-chief operating officer of AIG: "Directors' and officers' premiums must be commensurate with risk and are currently underpriced. D&O claims have increased hugely in the US and premiums need to keep up with the rise in costs. There is so much focus on corporate governance now that directors must ask themselves whether they understand the company they run."