The Government wants the UK insurance industry to work more closely with it to manage risks in society.
In a publication from the Insurance Industry Working Group (IIWG) into the medium and long-term challenges facing the insurance sector, the Government confirmed its desire to maintain a competitive industry.
The IIWG, co-chaired by Chancellor Alistair Darling and Andrew Moss, group chief executive of Aviva, says the UK should be a leading insurance centre by 2020, with a deep customer relationship and close ties to Government.
Government, insurers and the FSA need to work more closely to promote good financial education among the public and should take steps to improve transparency and consumer access.
The Government also wants to work with insurers to manage financial distress and longevity risks, helping the public sector deal with retirement income issues and long-term care.
Speaking today, the Chancellor says: "I welcome the industry's commitment to work in partnership with Government to improve confidence in insurance products, enhance financial capability and further build the competitiveness of this key British industry."
The ABI has welcomed today's report, but says it is important for the Government and FSA to ensure they contribute to the future success of the sector.
"Achieving the best results will depend on all the report's recommendations, which the ABI wholly support, being implemented in full - doing so will create the ‘virtuous circle' referred to in the report," says director general, Stephen Haddrill.
"We will be working with our members to achieve this, and we urge the Government and FSA to do the same."
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