LONDON (Reuters) - Changes to the UK regulatory regime could allow a domestic commercial reinsurance market to flourish and enable corporates to set up in-house insurers, UK insurance lobby group member Sean McGovern said on Tuesday.
Britain's upper chamber of parliament, the House of Lords, said late last week that its Industry and Regulators committee of lawmakers was launching an inquiry into the regulation of the London insurance market and how to improve the regulatory set-up for the industry post-Brexit.
The London insurance market includes Lloyd's of London and other domestic and international commercial insurers, reinsurers and brokers operating in Britain.
McGovern, chair of the London Market Group's government relations workstream and CEO of UK and Lloyd’s at AXA XL, said the commercial sector had sophisticated clients and needed a different regulatory approach from retail sectors such as home and motor insurance.
"The existing regulatory regime is not appropriately calibrated to the features of the London market," he told Reuters, pointing to the lack of domestic commercial reinsurance companies in Britain and the absence of so-called captives, in-house insurers set up by many large companies in countries such as Bermuda and Guernsey.
"The regulatory regime does not appear to be encouraging the establishment and growth of business in the UK," he said.
Submissions can be made to the inquiry until Feb 11.