Almost a quarter of insurers have admitted they are under "considerable strain" from regulation, according to new research.
The study also found that 23% of insurers have failed to embed corporate governance into their businesses.
The study, developed by the Institute of Financial Services, Oracle, Deloitte and Hewlett Packard, questioned 62 financial services companies, including insurers, about how they were coping with the raft of new regulations on solvency and corporate governance.
Many said they were tackling compliance from a "tactical" perspective, taking a piecemeal approach to the various compliance issues. Typical sources of information were the Integrated Prudential Sourcebook and the International Financial Reporting Standards.
Oracle UK head of sales consulting Dave Hanley warned that the failure of insurers to adopt a best practice approach to compliance could damage consuumer and shareholder confidence. He said: "The lack of an embedded corporate governance culture and the failure to adopt a strategic approach to compliance could lead to long-term problems for the industry.
"If you stand back, you do not need to develop a separate solution for each one - that is the strategic approach."