Research from the Financial Services Authority (FSA) shows that the role of insurers in the global credit derivatives market is growing, as the financial services industry tries to diversify its risks or increase its returns.

The FSA said insurers were estimated to have 20% to 25% of the $1,000bn (£683bn) to $1,500bn (£1,025bn) credit derivatives market.

FSA head of prudential standards Clive Briault said a key finding of its research was that although insurers had taken on a lot of risk using credit risk transfers, the most active participants had developed a good understanding of the products.