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The Independent
13-05-2025
- Business
- The Independent
FCA unveils plans to remove ‘outdated or duplicated' insurance rules
The City regulator is proposing to strip 'outdated or duplicated' requirements from its insurance rules, to help reduce costs for firms and encourage competition in the sector. The Financial Conduct Authority (FCA) said the UK's insurance market could benefit from simpler, more straightforward requirements. Proposals include no longer requiring companies to review the value of their product at least every 12 months; instead, they would use the risks and characteristics of each product to decide how often they review them. The regulator also plans to give firms flexibility to appoint one lead insurer to comply with its rules in situations where more than one party is involved in designing the insurance product. Specified minimum hours of training and development required for insurance and funeral plan employees would also be removed under the proposals. Changes could support lower costs and wider access for the businesses and consumers who rely on insurance to manage risk, while maintaining appropriate levels of protection, the regulator said. It is also proposing to create a new definition to identify big commercial insurance customers who should not be captured by its conduct rules. This would ease the burden on firms insuring larger businesses that can manage risks independently, while protecting smaller commercial customers, the FCA said. The consultation document said: 'Given the global nature of the commercial market, it is important that our rules deliver proportionate regulation that promotes effective competition. 'We also want to ensure that our rules advance our secondary objective to facilitate the international competitiveness and growth of the UK economy, as far as reasonably possible.' Matt Brewis, director of insurance at the FCA, said: 'We are stripping back our insurance rule book by removing ineffective, outdated or duplicated regulation, as part of our drive to become a smarter regulator and support growth. 'We have listened to industry and we are taking action. In doing so we will reduce regulatory costs and increase the competitiveness of the already world-leading UK insurance sector, while maintaining vital protections for smaller customers.' The consultation follows the FCA's commitment to withdraw more than 100 pages of 'outdated' guidance in a bid to streamline rules, reduce burdens on businesses, and improve outcomes for consumers after the introduction of the Consumer Duty. The Consumer Duty requires financial firms to put customers at the heart of what they do, including in the design of their products and in their communications with customers. The UK Government has put emphasis on streamlining regulations as part of its drive for economic growth. The FCA wants to hear feedback on the proposals by July 2 2025. David Otudeko, director of regulation at the Association of British Insurers (ABI), said: 'The overly complex regulatory system has long been a concern for the industry. The FCA's focus on easing some of this burden, to simplify rules and create a more straightforward system, is welcome. 'We look forward to continuing to work with the FCA throughout its consultation process to achieve the right balance between consumer protection, economic growth and market integrity, and help our members ensure good outcomes for customers.'
Reuters
06-05-2025
- Business
- Reuters
American Electric Power beats profit estimates, expects minimal tariff impact
May 6 (Reuters) - American Electric Power (AEP.O), opens new tab beat Wall Street estimates for first-quarter profit on Tuesday, benefiting from higher demand from commercial customers, and said it expects minimal direct impact on its long-term spending plan from tariffs. Big Tech's massive investments into artificial intelligence technologies and related infrastructure have fueled a surge in demand for power, encouraging energy producers to ramp up investments. The Reuters Power Up newsletter provides everything you need to know about the global energy industry. Sign up here. In February, AEP said it would boost its record $54 billion five-year capital plan by $10 billion on demand for data centers in the electric utility's Midwest and southern service areas. "Our capital investments are key to enhancing reliability and customer service and meeting the over 20 gigawatts of new power demand we expect by the end of the decade," CEO Bill Fehrman said in a statement. "We have determined that the direct tariff exposure on our $54 billion capital plan is minimal at about 0.3%." In April, the U.S. Energy Information Administration (EIA) said U.S. power consumption will hit new record highs in 2025 and 2026, with demand rising to 4,201 billion kilowatt hours (kWh) this year. AEP said commercial load grew 12.3% in the reported quarter. Operating earnings at its vertically integrated utilities segment was $349.9 million, compared with $300.3 million a year earlier. The transmission and distribution utilities segment reported operating earnings of $192.3 million, compared with $150.3 million. AEP serves about 5.6 million customers in 11 states including Texas, Ohio and Kentucky. It possesses the largest electric transmission system in the U.S. The utility reaffirmed its annual adjusted per share earnings forecast of $5.75 to $5.95. The Colombus, Ohio-based company posted an adjusted profit of $1.54 per share for the three months ended March 31, beating analysts' average estimate of $1.40, according to data compiled by LSEG.
