Biba conference 2009 - Conflict over FSA in conference debate

While Axa's chief executive Philippe Maso said the performance of the Financial Services Authority's was "outstanding" in comparison to its continental peers, Eric Galbraith - chief executive of the British Insurance Brokers' Association - disagreed, criticising the regulator as being out of step with the original proposals of the Insurance Mediation Directive.

Maso, attending the 'Delivering Value' debate, was asked by guest host and business guru Rene Carayol to offer an insurer's point of view on the Financial Services Authority.

Plaudits

"Its work has been outstanding compared to what has been happening in (the rest of) Europe. Regulation on the continent is extremely rules-based and I would urge the FSA not to over-regulate in this country," he commented.

Maso voiced concern about a tendency to introduce strong regulation in response to crises, in effect regulating today to fight the battles of the past.

"My plea would be to not cover the whole financial services industry with the same regulation in response to the problems of one sector. Stability comes from regulatory clarity but the toolkit is already there; we need to let the FSA do its job in a calm environment," he said. However, he warned: "Don't carpet-bomb the industry to rid it of certain unethical practices. Let's not over-regulate."

In contrast, Biba chief executive Eric Galbraith used his opening address to attack the FSA: "The style and cost of insurance intermediary regulation in the UK is unlike that of any other EU country. When the European policy-writers drafted the Insurance Mediation Directive, I am certain they did not in their wildest dreams envisage the regime that it spawned here in the UK."

Galbraith said that the FSA should not concentrate on enforcing regulation that "will ultimately reduce customer choice and access to advice at a time when it is needed the most" and that it should ensure it provides "cost-effective, value-for-money regulation where any increases are fully justified." Galbraith concluded by stressing: "Biba will be watching."