The Tories and Liberal Democrats have attacked the FSA for being "too complex, too big and too expensive".
With only six weeks to go before the rumoured 5 May polling day, John Redwood, Conservative minister for deregulation, told Insurance Times: "We suggest 8,000 pages of FSA regulations is excessive, particularly given that the vast majority of companies are compliant."
The Conservatives will publish a broad reaching examination of the FSA in the next month. Redwood said the review will "identify ways to cut back the excessive regulatory burden on compliant companies."
The Lib Dem spokesman for the DTI, Malcolm Bruce, said the FSA was also failing in its role to protect the consumer:
"The industry uses the FSA as a cover for bad practice. People who complain are told, 'the FSA says this is ok'. Previously insurers would have had to make their products more competitive."
Bruce added: "The consumer is given the impression that that they have got a guarantee. They have not."
The party advocates the establishment of a department for the consumer to protect the interests of vulnerable members of the public.
The Treasury dismissed the criticisms, claiming the FSA is viewed around the world as a "state-of-the-art regulator."
Stephen Timms, financial secretary to the Treasury, told Insurance Times: "We have seen a big consolidation of London's importance as a financial services centre over the last few years.
"London is the financial services centre of Europe now and that strengthening of the capital's position has coincided with the period in which the FSA has been active."
' Who should you vote for? See news analysis for what the main parties have to offer the insurance industry, p10-p11
Tell the main parties what this industry wants
The insurance industry feels neglected by successive governments and has for years has talked about an Insurance Czar being appointed to champion insurer and broker issues.
In the run-up to this year's election, Insurance Times is campaigning for a 'Minister for Insurance' to grasp the nettle and knock on the door of No 10. We want our readers to give your views on who should take up this challenging role and what their brief should be. We will lobby the main parties during this campaign so that the industry's voice is heard.
Email: firstname.lastname@example.org with your ideas...