Countdown to chancellor contest

We will have a new Prime Minister at some stage this year and it would be a very rash person who would bet against that being Gordon Brown. What could that mean for the insurance industry?

Key will be the identity of the new Chancellor, and this seems to have most commentators guessing. In pole position has to be the current number two at the Treasury, Stephen Timms, however, he rarely seems to figure in the speculation. Alistair Darling is a name that is often put in the frame and is certainly a plausible choice. David Miliband, currently in charge of Environment, Food and Rural Affairs, also figures in the speculation.

Timms and Darling both have the attraction of being known quantities as far as the insurance industry is concerned and not unsympathetic to the problems it faces. Either of them, coupled with a leg up for the junior Treasury minister Ed Balls, would put in place a Treasury team that had a better understanding of the insurance industry than most over the past 20 years or so.

Elsewhere, the departure of John Prescott from the front rank of British politics will be warmly cheered in the insurance industry. His blind pursuit of his dream of a huge development alongside the River Thames estuary sends shivers down the spine of property underwriters. Although he no longer has departmental responsibility for this - that lies with Ruth Kelly's Communities and Local Government department - he looms large over discussions on the topic.

The Association of British Insurers has not been slow to criticise the patently absurd idea of building large numbers of homes on the Thames flood plain but we can expect to see a renewed assault on the plans, once the pugilistic Prescott has thrown his last governmental punch.

A shift away from government by target and league table would be welcomed by the insurance industry, especially if applied to some of the areas of Home Office responsibility. It rankles deeply with the industry that police forces have no targets for tackling fraud, so getting police attention for the serious issues raised by staged accidents and other forms of widespread claims fraud is very difficult. Obsession with targets by police forces makes the debate about tackling staged accidents a highly political one because with a change in priorities set by government police will not direct the resources to tackle it. A more flexible approach, allowing the police to make more decisions about how to deploy their resources would be a big step forward.

- David Worsfold, Secretary, All Party Group on Insurance and Financial Services.