New FSA insurance rules praised by Abbey

17 January 2005
Abbey, along with the majority of commentators, has praised the introduction of a new regulatory regime for insurance.

From Friday responsibility for regulating insurance moved from the General Insurance Standards Council to the Financial Services Authority.

Angus Porter, Abbey's customer director, said: "We think the new regulations will bring real benefits to consumers. They'll ensure that people receive details of exactly what is and isn't covered before they buy insurance and will provide more detailed information about insurance policies that will make buying decisions easier.

"Abbey will provide advice along with the new 'Key Facts' documents as we believe that there is no substitute for talking with people to fully understand their needs. Abbey staff have already been fully trained in the new regulations and we're confident that consumers can only benefit from what will be a much improved process."

There have, however, been some concerns raised over the changes.

Commentators have highlighted the fact that the new system might mean costlier premiums and some travel insurance and extended warrantee policies do not fall under the new protection.

Nick White, of price comparison service, said: "Even though insurance regulation is obviously a good thing, and will help consumers in the long run, the increased cost of such regulation does mean that insurance providers and brokers will look for ways to pass on the cost instead of eroding the profits they make."

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