Guidelines on finite reinsurance have been published for companies in the London Market by the International Underwriting Association (IUA).
The aim of the guide is to summarise the Financial Services Authority's (FSA) position on finite reinsurance and help companies consider the systems and controls necessary to meet the regulator's rules.
Pam Byrnes, director of Financial and Compliance Services at the IUA, said: “There has been much debate about the use of finite reinsurance in recent months and we thought it was a useful exercise to clarify the current position for IUA members.
“The FSA's objective is not to prevent the use of finite reinsurance, but to ensure it is used correctly. There is a role for finite reinsurance in the marketplace and these guidelines will help show how such products can be used correctly to strengthen a company's position and add protection for the policyholder.”
