REG Reviews
1st May 2025
Last month, the FCA launched its 5 year strategy with a focus on embracing tech and combating financial crime, AI adoption rose among brokers, the BoE announced initiative to accelerate insurer investment, CII called on firms to prioritise vulnerable customers and REG became an Annual Silver Sponsor to the MGAA.
Read these articles and many more as we bring you all the important news and views in the insurance and financial services world…
The UK’s Financial Conduct Authority (FCA) has unveiled its 2025–2030 strategy—a five-year blueprint that signals a transformative shift in how the UK regulates financial services. With technology, artificial intelligence (AI), and financial crime prevention at its core, the FCA is setting a clear direction: smarter regulation must be data-driven, digitally enabled, and prepared to act faster and more assertively where harm is greatest.
At the heart of this strategy are four strategic priorities: becoming a smarter regulator, supporting sustained economic growth, helping consumers navigate financial decisions, and fighting financial crime. Yet it’s the intersection of technology and trust that cuts across each of these priorities—and defines the FCA’s ambitions for the next five years.
“We want to deepen trust in financial services and shift our collective attitude across financial services to risk,” said Ashley Alder, FCA Chair. “Too often the focus has been on the risks of a decision taken rather than the lost opportunity of taking none. We want to change that so we can spur growth and improve lives.”
A Smarter Regulator Enabled by Smarter Systems
Underpinning the FCA’s push to become a smarter regulator is its increased investment in digital systems, people, and infrastructure. This includes the rollout of ‘MyFCA’, a new digital portal that consolidates key functions such as data submission, fee payment, and core firm interactions—all in one place.
“As the FCA’s CDIIO, I have a pro-technology approach to making the FCA a smarter regulator,” said Jessica Rusu, the FCA’s Chief Data, Information and Intelligence Officer. “Last month, we launched our new digital portal ‘MyFCA’ for firms to submit data, pay fees, and manage core interactions with us all in one place.”
Behind the scenes, the regulator is scaling its data infrastructure at an unprecedented rate—now processing around 1 billion trading records per day—and increasingly using advanced analytics to translate data into enforcement action. In 2023 alone, the FCA issued over 2,240 alerts for unauthorised business, demonstrating the impact of linking intelligence with rapid regulatory response.
AI in Action: From Voice Bots to Live Testing
The FCA is not just collecting data—it’s using AI to make sense of it. In its Supervision Hub, AI tools are already deployed to support case handlers in real time. This includes predictive analytics, conversational voice bots that route consumers to the appropriate agency on first contact, and machine learning models that detect early signs of harm.
Crucially, the FCA is experimenting with Large Language Models (LLMs) to analyse unstructured text, such as application documents or firm communications. This allows for faster fact extraction and synthesis while preserving human oversight and judgement.
“Our people remain integral, using their expertise for judgement, while AI focuses on fact extraction and synthesis,” Rusu said. “Our goal is to respond, decide, and raise concerns faster without compromising quality.”
These innovations offer a glimpse into what the future of supervision could look like—more scalable, more consistent, and more intelligent.
The FCA has also launched AI Live Testing, a collaborative program allowing firms to test generative AI models alongside regulators. The initiative, part of the newly formed AI Lab, is designed to encourage safe and responsible AI adoption—including consumer-facing applications—by helping firms understand the performance and regulatory implications of the models they’re building.
“FCA AI Live Testing enables generative AI model testing in partnership between firms and supervisors,” Rusu announced. “Our goal is to give firms the confidence to invest in AI in a way that drives growth and delivers positive outcomes for consumers and markets.”
The FCA has made it clear that existing frameworks—particularly the Senior Managers and Certification Regime (SMCR) and the Consumer Duty—already provide sufficient oversight for AI. This means that innovation does not need to wait for new rules; it can progress within the current regime, provided risks are understood and managed.
The FCA’s “Innovation front door” remains open, and the AI Lab is actively seeking input on how to make live testing a lasting success.
Financial Crime: Smarter Surveillance, Sharper Action
Fighting financial crime was a top priority in the FCA’s previous strategy—and it remains front and centre in its 2025–2030 blueprint. The regulator has set its sights on those who, in its words, “aim to use FCA authorisation as a cover for crime”, pledging to go further in identifying and disrupting such actors before they cause harm.
As part of this, the FCA will continue working closely with regulated firms, describing them as a “vital line of defence against the criminal misuse of our financial services.” To support this frontline role, the regulator plans to enable firms with smarter technologies that enhance detection, improve controls, and help reduce the cost of compliance. This opens the door for innovation in solutions that automate due diligence, streamline onboarding, and deliver continuous monitoring at scale.
The FCA is also strengthening its collaboration with the UK’s law enforcement agencies, other domestic regulators, and international partners—ensuring intelligence can be shared efficiently and actions coordinated globally. In a world where financial crime networks operate across borders, these links are essential for timely, effective disruption.
Beyond institutional controls, the strategy also emphasises the importance of consumer empowerment. The FCA will seek to raise public awareness and education around scams and fraudulent schemes, helping individuals better protect themselves from financial harm.
This multi-layered approach—uniting firms, regulators, and the public—underscores the FCA’s belief that tackling financial crime requires both smarter surveillance and sharper collaboration.
Looking Ahead
“Our 4 priorities reinforce one another and we look forward to collaborating with our partners as we become a smarter regulator, support growth, help consumers and fight crime,” said Nikhil Rathi, Chief Executive of the FCA. “We are ambitious for the future and committed to enabling a fair and thriving financial services market for the good of consumers and the economy.”
The FCA’s strategy is an operational shift that creates significant opportunities for collaboration between regulators, firms, and the technology partners that support them. As the regulator becomes more tech-positive, data-rich, and assertive, the firms that thrive will be those who can align with this new vision: faster, smarter, and safer.
Digital transformation is gaining momentum in the broking community, as new data reveals a surge in appetite for automation and generative AI (GenAI) to streamline services and sharpen competitive advantage.
Aviva’s 2025 Broker Barometer shows that 85% of brokers are now interested in enhancing operations through digital or automated processes, marking a 15% increase since 2022. Among those already adopting these tools, 70% have implemented GenAI, with national brokers leading uptake at 75%.
The drive towards digitalisation is supported by brokers’ top priorities: improving customer service and gaining a competitive edge, closely followed by a desire to increase new business.
This shift isn’t just internal. Brokers are pushing their insurance partners to follow suit. The most common request? Greater use of digital technology to enhance broker services. Additionally, 29% want access to more data and customer insights, slightly surpassing those prioritising improved service alone (28%).
Automation is also reshaping underwriting. For premiums under £5,000, 36% of brokers prefer automated underwriting edging ahead of in-person approaches (31%). However, for larger, more complex risks, human insight still matters: 48% prefer in-person support for premiums over £5,000 so it is about finding the balance between the two.
Jason Chambers, Innovation Director for Commercial Lines at Aviva, notes: “By using data and technology more effectively, brokers can simplify once-complex processes and improve customer service. GenAI has already helped us reach 70% same-day completion of mid-term adjustments in our regional business.”
While enthusiasm for tech is high, Chambers stresses that “human oversight remains essential” especially for complex risks. The message is clear: brokers are embracing a hybrid future, where smart automation and expert judgement go hand-in-hand to meet evolving client needs.
The UK’s National Cyber Security Centre (NCSC) has issued a warning: organisations must future-proof their systems against the threat of quantum computing by 2035.
In newly published guidance, the NCSC is urging operators of critical national infrastructure, including energy and transport firms, to adopt “post-quantum cryptography” to guard against the eventual rise of quantum hackers. Although quantum technology is still in development, the agency warns it could one day crack the complex maths that current security systems rely on, making them ineffective.
“While today’s encryption methods… rely on mathematical problems that current-generation computers struggle to solve, quantum computers have the potential to solve them much faster,” said the NCSC, highlighting the need for urgent preparation.
The roadmap laid out by the agency advises organisations to identify vulnerable systems by 2028, begin upgrading priority services by 2031, and complete a full migration to post-quantum encryption by 2035.
Quantum computers represent a leap in processing power, using qubits instead of traditional binary bits. This enables them to process multiple outcomes simultaneously, potentially unlocking encryption in ways today’s technology cannot.
Although a fully operational quantum computer has yet to materialise, qubits remain fragile and highly sensitive, the NCSC stresses the need to act now. “Our new guidance… provides a clear roadmap for organisations to safeguard their data against these future threats,” said NCSC Chief Technical Officer Ollie Whitehouse.
Alan Woodward, professor of cybersecurity at the University of Surrey, added: “Now that there are new methods for public key encryption, it makes sense to migrate now rather than wait for the threat to become real.”
Without action, systems currently considered secure may become dangerously exposed.
The Bank of England’s Prudential Regulation Authority (PRA) has announced a major new initiative aimed at speeding up insurer investment into the UK economy. Unveiled in an official consultation paper, the Matching Adjustment Investment Accelerator (MAIA) is a proposed framework that would allow insurers to invest more quickly in long-term productive assets—such as infrastructure and clean energy—while still maintaining robust safeguards for policyholders.
At the heart of this proposal is a shift in how the Matching Adjustment (MA) regime operates. Under the current system, insurers must obtain full PRA approval before new asset types can be included in their MA portfolios—portfolios that are used to match long-term liabilities, such as annuities, with long-duration assets that deliver stable returns. This process can lead to significant delays, particularly when firms seek to invest in newer or less conventional asset classes.
To address this, MAIA introduces a fast-track process. It would grant insurers provisional approval to include eligible assets in their MA portfolios for a period of up to 24 months, provided certain conditions are met.
During this window, firms can finalise a full MA application for these assets while already deploying capital. This dual-track approach enables insurers to seize time-sensitive investment opportunities without having to wait for formal approval—boosting market responsiveness and efficiency.
The PRA has emphasised that policyholder protection remains a top priority. The MAIA process includes clear eligibility criteria and ongoing oversight to ensure that the temporary inclusion of new assets does not undermine the security of insurers’ long-term obligations.
According to the PRA, the MAIA proposal directly supports its secondary statutory objective: to facilitate the UK’s international competitiveness and long-term economic growth. By streamlining regulatory procedures and enabling insurers to act faster, the initiative is expected to unlock billions of pounds of investment for UK infrastructure, housing, energy transition, and other strategically important sectors.
Sam Woods, Deputy Governor for Prudential Regulation and CEO of the PRA, commented: “This proposal balances a more agile approach to investment with the high standards of protection our financial system is known for. By giving insurers more flexibility, we can help channel significant capital into the real economy without compromising our core regulatory responsibilities.”
The consultation will remain open until Wednesday 4th June 2025, during which time the PRA invites feedback from insurers, asset managers, and other stakeholders across the financial services industry.
With the UK government continuing to champion reforms that mobilise private capital for national growth, the MAIA framework represents a tangible step towards making the UK a more attractive, responsive, and competitive place to invest.
Ensuring good consumer outcomes by financial services firms is not only compliance teams’ responsibility, but also the one of boards, directors and senior leaders.
In fact, Chartered Insurance Institute (CII) emphasised in its recent report that assigning this responsibility to regulatory and customer service teams alone is not enough anymore and that responsibility must be shared among all hierarchical levels.
CII said that: “Many firms are stuck in a tick-box mentality and not striving for genuine customer-centricity.”
It also added that: “Many firms are failing to demonstrate the causal chain between identifying vulnerability and achieving improved outcomes, so improvement efforts lack meaningful evidence of success.”
This new report is particularly in response to the FCA’s review of how financial services firms treat vulnerable customers. The FCA discovered that some businesses weren’t evaluating and reporting on customer outcomes adequately or acting proactively when they’ve identified problems.
FCA director of cross-cutting policy and strategy, Charlotte Clark, highlights that not only should firms identify vulnerable traits in their customers, but they should continue delivering top notch support across the entire consumer journey.
Clark added that it’s crucial to have adequate communication channels that can help firms assist and understand their customers better.
According to the CII, financial services professionals should embody empathy and compassion when speaking with their clients, with an emphasis on providing training to employees and teaching them how to approach customers better.
The CII’s report also sets out their expectations in accordance with the following:
CII CEO Matthews stresses on the continuous efforts of the report in developing pragmatic processes that firms could use to deliver concrete betterments for vulnerable customers.
REG Technologies is pleased to announce its new role as an Annual Silver Sponsor of the Managing General Agents’ Association (MGAA), marking a continued commitment to supporting MGAs and advancing innovation across the insurance sector.
This sponsorship builds on over five years of collaboration between REG and the MGAA community. As a trusted RegTech partner to many MGAA members, REG plays a vital role in helping firms navigate compliance challenges, strengthen governance, and unlock new trading opportunities with confidence.
“MGAs bring agility, innovation, and niche expertise to the insurance market, and the MGAA plays a pivotal role in connecting these organisations with insurers and suppliers,” said Marketing Manager, Zoë Parsons at REG Technologies. “Our sponsorship reflects a shared vision: enabling a collaborative, efficient, and forward-thinking insurance ecosystem.”
At the core of REG’s offering is The REG Network, a secure, cloud-based SaaS platform that simplifies and automates the onboarding, oversight, and management of brokers, insurers, and other counterparties. By digitising manual processes and delivering real-time intelligence, REG empowers MGAs to scale relationships without compromising compliance or control.
Through this sponsorship, REG aims to further engage with MGAA members, sharing insight, supporting thought leadership initiatives, and offering the tools MGAs need to meet increasing regulatory demands—including AML, ESG, and Consumer Duty—while driving growth and operational efficiency.
“We’re excited to deepen our relationship with the MGAA and its members,” added Zoë Parsons. “Together, we can help the market trade faster, smarter, and safer.”
REG Technologies is transforming how the insurance market connects and trades. Through The REG Network, the company provides intelligent automation for onboarding, due diligence, and regulatory oversight—supporting MGAs, brokers, and insurers in building secure, scalable, and compliant business relationships.
The insurance sector is facing increased regulatory burden year on year as regulators are constantly implementing new laws and updating existing ones.
This is particularly harder for smaller firms that don’t have established compliance teams, dedicated experts or the budget to carry out complex compliance processes, according to Insurance Times.
Based on Insurance Times research (Five Start Rating Report: Commercial Lines and Personal Lines 2024/2025), around 44% of the UK general insurance brokers that have been surveyed in late 2024 think that the current regulatory landscape in the UK’s insurance sector is too strict, hindering businesses’ ability to be compliant and create new business simultaneously.
Importantly, smaller brokers’ views on regulation complexities are 13% higher than larger counterparts and this is mostly due to smaller firm’s lack of resources and capacity to be on top of the FCA’s expectations, according to compliance consultancy principal, Branko Bjelobaba.
Moreover, Insurance Times survey participants heavily emphasised on regulation issues, with 44% believing that the FCA’s monitoring efforts are too constraining. However, 49% think regulation is balanced.
When giving a speech regarding her strategic economic growth plan, chancellor of the exchequer, Rachel Reeve said: “We are setting out the five priority growth opportunities on which that strategy will focus – fintech, sustainable finance, insurance and reinsurance and capital markets.”
As part of watchdogs’ efforts to lift the current heavy regulatory weight on the insurance sector, PRA chief executive Sam Woods told the House of Lords Financial Services Regulation Committee that they’ve already decreased complex reporting for insurance by approximately 30%, adding that they’re trying to do the same for banks too.
With the FCA’s 5-year strategic plan to bolster trust and improve financial services growth in the horizon, conversations around regulation and the strain it causes for the market will continue, despite plans to relax the burden. Now the real question will be how will insurers and brokers adapt? A partial answer to this question is with no doubt: Investing in technology and digital transformation.
Insurtech startups are revolutionising the insurance industry by integrating advanced technologies to streamline operations and significantly enhance the customer experience. One of the key innovations in the use of artificial intelligence (AI) and automation in claims processing.
AI algorithms are now being used to analyse claim documents and images, improving the speed and accuracy of claim assessments. Machine learning models help detect fraudulent claims in real time, while Robotic Process Automation (RPA) handles repetitive tasks like data entry and document processing.
This not only speeds up claim resolution but also reduces human error, providing customers with a more efficient and transparent process. In addition, AI-powered chatbots and virtual assistants offer 24/7 support, guiding customers through the claims journey and making the process more accessible. These advancements are fostering stronger customer trust and satisfaction by providing faster and more accurate service.
Beyond claims, Insurtech startups are also improving customer engagement through personalised, data-driven experiences. Digital platforms and mobile apps give customers real-time access to their policies, allow them to file claims instantly, and provide proactive notifications, all of which create a seamless and convenient experience.
By leveraging big data analytics, these companies can also assess risks more accurately and offer personalised pricing models. This data-driven approach allows customers receive tailored coverage, improving satisfaction and reducing fraud.
Last month, the government announced that it will soon be introducing its new Cyber Security and Resilience legislation to parliament in order to combat major cyberthreats.
This new legislation is also designed to bolster the UK’s cybersecurity measures and safeguard vital infrastructure and key digital services, ultimately improving the protection of critical national infrastructure (CNI).
This law means that many digital and IT services providers will have to meet stricter regulatory reporting standards in order to protect the public and the general economy from cybercriminals.
According to the UK government, this move will provide the British public, companies and investors higher trust in online services and in turn enable economic prosperity.
Moreover, managing director of Intersys, Matthew Geyman, highlights that resilience should also be prioritised and is considered as important as compliance. He also adds that: “Businesses should be focusing on continuous risk assessment, security monitoring, and enhanced staff training. Cyber security as a service will become essential.”
Not to mention that cybercrime costs the UK billions each year. For instance, the Synnovis NHS breach alone led to £32.7 million in damages and thousands of missed appointments back in 2024.
So what does this mean for the insurance sector? And what impacts will the new legislation have on the market?
Cyberattacks are a major setback for the insurance sector, leading to high claims and payouts, which in turn pushes insurance firms to set higher premiums for their clients.
With the new cybersecurity bill being introduced, cybercriminals won’t be able to orchestrate an attack as easily as before, which will support the cyber insurance sector as a result and encourage people to buy cyber insurance products.
According to Geyman: “For the insurance sector, the bill represents both a challenge and an opportunity.”
He also emphasises that: “By compelling organisations to enhance cyber security controls and reporting, this legislation could reduce risk exposure, providing insurers with greater confidence in underwriting cyber and business interruption policies.”
Thomas Barrett, partner at cyber consultancy CyXcel shared with Insurance Post that while the advantages of the new bill outweigh the disadvantages for the insurance market, some smaller firms might think that they no longer need to buy cyber insurance if they’re complying with the new rules.
The new cybersecurity bill is just the start towards a better economy, safer infrastructures, and happier customers, and the real changes will only start to become noticeable once the laws have been implemented by the parliament later in the year.
As markets stay volatile and economic challenges persist, Dr. Louis Williams, head of psychology and behavioural insights at Dynamic Planner, is encouraging advisers to treat behavioural psychology as an essential part of the advice process, rather than a supplementary skill.
In fact, Dr Williams stresses on the importance of having meaningful conversations with clients which ultimately translates into trust and compassion, particularly in volatile markets.
Global markets have been disturbed even further by the US’s recent 104% tariff on Chinese goods and the latter’s plans to take revenge, which risks leading clients to take emotional decisions rather than logical ones.
Dr Williams told Professional Adviser that during periods of financial uncertainty, advisers must have access to the necessary resources and have the right technology in place help their clients make rational decisions that are focused on long-term goals.
From a compliance perspective, technology plays a crucial role in helping advisers exceed their regulatory obligations. Following the implementation of the Consumer Duty, Williams noted that proper digital tools and systems play an irreplaceable role in identifying client vulnerabilities, monitoring data and maintaining accurate advice standards.
Moreover, Williams said that: “The ability to collect and analyse behavioural and demographic data is especially useful in identifying potential client vulnerabilities”, adding that: “It allows advisers to treat customers fairly while also documenting the process clearly.”
Williams also explains how technology helps decrease operational inefficiencies, which gives advisers more control over their administrative and reporting tasks through automating day to day laborious processes and allowing them to focus on strategic work.
The importance of technology to handle complex regulatory processes not only holds true for financial advisers but is increasingly becoming a crucial aspect of the entire insurance and financial services sector.
After all, the goal of simplifying complex and manual processes and eradicating redundancies to focus on creating business and treating customers fairly is a shared goal among all insurance and financial leaders. Without the use the right technology or provider, staying ahead of regulatory demands will become even more burdensome.
And while technology is a crucial aspect of assessing vulnerable customers and keeping up with regulatory responsibilities, Williams highlights that true behavioural advice begins with empathy. He stressed the importance of clear, relatable communication, ensuring advice matches the client’s needs and understanding.
For Williams, the key is to assist clients to make the right and logical durable financial decision, instead of one that’s based on short term emotional pleasure.
Motorists in the UK are experiencing the most significant drop in car insurance premiums in over a decade, with average comprehensive premiums falling by 16% (£161) to £834 in the 12 months leading up to the end of 2024.
This decrease comes after several years of rising premiums, particularly between 2021 and 2023, and marks the fourth consecutive quarterly reduction in car insurance costs. Key factors behind this decline include lower inflation rates, fewer motor claims, and a more competitive market.
The overall result is that car insurance has become more affordable for many drivers, although it’s worth noting that existing customers aren’t always benefiting as much from these reductions. New customers are seeing the largest savings.
While prices have decreased, the savings aren’t uniform across the country. For example, drivers in Manchester and Merseyside have seen the biggest percentage drop of 19%, with their average premiums now under £1,000 for the first time in 18 months. On the other hand, premiums in regions like the Scottish Borders have only fallen by 10%, with drivers there now paying an average of £590.
Young drivers, especially 18-year-olds, have seen some of the biggest reductions, with their premiums dropping by £557, now averaging £2,605. This is thanks in part to the growing use of telematics data, which rewards safe driving habits. As more insurers embrace this technology, we can expect to see premiums for safer drivers continue to fall.
However, the experts do warn that future trends will depend on various market forces, including regulatory changes and economic pressures. It’s clear that UK motorists are enjoying a rare moment of relief in the car insurance market.
Last month, brokers were seen to be consolidating agencies to prioritise key insurer relationships, the FCA intensified its crackdown on misleading financial ads, fraudulent claims sky-rocketed and industry professionals pushed for enhanced AI training to bridge the gap within insurance. Read these articles and many more as we bring you all the important news and views in the insurance and financial services world…
Last month, the FCA updated its guidance on 'polluter pays' and redress liabilities, the regulator also announced strategies around 'unnecessary regulation,' insurance fragility in the US was revealed in the wake of LA fires, a shift to AI hiring was noted among UK firms, and REG Technologies partnered with Insurance Post to discuss the regulatory challenges facing MGAs and insurers and the role of technology in easing the burden.
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Last month, the FCA released its Product Oversight and Governance review and increased scrutiny of Principal Firms' oversight on ARs, REG partnered with Insurance Post to debate whether RegTech is a luxury or a necessity for tackling regulatory challenges, Insurance Business TV featured industry leaders discussing DEI and talent issues in the insurance sector, and rising concerns over deepfake and document fraud continue to affect the industry...
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Last month, the growing threat of summer floods was highlighted, urging both policyholders and insurers to take proactive steps. The FCA's Market Watch 79 emphasised the importance of strong data management in surveillance against market abuse, firms were reminded that the Consumer Duty is not a 'one time requirement', but a continuous effort, and REG is excited to sponsor the upcoming MGAA Annual Conference and collaborate with MGAs about the value of partnerships…
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