Director General of the ABI Otto Thoresen has warned that the insurance industry needs to bolster its reputation as twin-peak regulations will fail to improve the trust-deficit.
Mr. Thoresen was addressing the Association of British Insurers’ (ABI) biennial conference today. “The reputation of UK financial services was undoubtedly harmed by the banking crisis.
“Insurers are not banks. Despite this, we have to tackle our reputation head-on and we have a good platform to do this from”, he said.
Underling the industry’s contribution, he said: “Consumers recognise the importance of insurance and every day insurers pay out £173m in pensions and life insurance and £58m in general insurance claims, such as on motor and household.
“Yet despite the valuable role insurance plays in millions of people’s lives, the public perception of our industry is not high. We need to do something about this”, he added.
The DG’s statement came as the KPMG and ABI survey showed reputation as the industry’s biggest failing and 57 industry leaders voiced their concern over the influence of the European Union and the new regulatory structure.
Since the financial crisis has wider repercussions, two-thirds of the executives surveyed said more needs to be done to show customers that insurers deliver good service.
However UK’s new twin peaks regulatory structure is unlike to boost customer trust, felt nearly half of the industry leaders. About 98 percent industry leaders were worried about the influence of the EU on the UK.
“Regulation has clearly risen to the forefront of the agenda, which comes at a time when many insurers face significant market pressures”, Drew Fellowes, UK head of insurance at KPMG.
“As insurers battle through the waves of regulatory change, their challenge is to manage this in line with their strategic priorities and duties to shareholders and customers”, he added.