With the year’s political and regulatory framework still taking shape, the industry needs to build on its success in forging a united front
Another year, another set of challenges – and yet more new year’s resolutions.
This time last year, I said that there had to be one overriding objective: if our great industry could speak with one voice, we could not only make a difference but we could set the agenda.
So we did – and 2010 turned out to be a pretty busy year.
We started last year with Sir Rupert Jackson's excellent report on civil litigation costs. I say excellent because, whatever you may think about his recommendations, you cannot deny that the report is a tremendous piece of work.
We now have the coalition government's response. The Ministry of Justice's consultation on proposals to abolish the recovery of success fees and after-the-event premiums and to introduce contingency fees remains open until 14 February.
These are important concepts that will shape the way litigation is funded for many years to come. I would urge all Insurance Times readers to be a part of those plans by responding to the consultation individually and collectively in a constructive way.
Meanwhile, Lord Young has come and gone, leaving us all to respond to his ‘Common Sense, Common Safety’ report, which recommends an ambitious programme to be completed by April 2012.
I believe that this date is no accident. The net effect of Lord Young’s recommendations should make it easier for people to take on roles to help their communities as part of the government's Big Society – which will be put to the test when London hosts the Olympics in 18 months' time.
On the regulatory side, we await two important developments and I hope we will see clarity on these very soon.
First of all, it is vital that the principal appointments at the new Consumer Protection and Markets Authority (CPMA) are made as soon as possible. The industry needs to have confidence in the new body, and this will only come when the head is announced. Let us hope it is someone who understands the insurance industry and who understands business.
The sooner the announcement is made, the better – given the current period of uncertainty, there is already a real risk that good people will leave the FSA.
Secondly, although we know that alternative business structures (ABS) are to be permitted under the Legal Services Act from 6 October 2011, we still have only limited information about the regulatory framework. The Solicitors Regulation Authority recently published guidelines on how businesses can ‘line up’ relationships before October. However, this is a curious announcement when many basic regulatory issues for ABS remain shrouded in mystery.
You all know how strongly I believe in self-regulation and the need to build on our hard-earned and well-deserved reputation for expertise, integrity and professionalism, and also a universally high standard of service-based regulation to ensure that consumers continue to get the best advice for their needs. That must surely be the goal for the new CPMA.
London must strengthen its reputation as the global centre for insurance and reinsurance – recent events elsewhere in Europe reinforce that. We must all speak with one voice to ensure that the coalition government introduces a range of tax, regulatory and policy initiatives in 2011 that will enable London to build on its role as the pre-eminent global financial centre.
May you live in interesting times – as the ancient Chinese curse has it! IT
Lord Hunt is a partner and chairman of the financial services division at national commercial law company Beachcroft