The insurance industry is waking up to a new era this morning as the FSA assumes regulatory control today.
The FSA said if the costs of regulation were passed onto consumers, the cost of each general insurance policy would rise on average by £2.80.
Authorisation has been given to around 17,000 firms, it said.
Interim permission has also been given to companies that applied before the 14 January deadline but had not received authorisation notices.
Consumers will now be able to report complaints about general insurance firms to the Financial Ombudsman Service.
The Financial Services Compensation Scheme (FSCS) will also pay out compensation to the consumer if they incur a financial loss when an authorised firm fails.
Customers of companies with interim permission will not be able to use these services, it was warned yesterday.