UK insurers increased their monitoring of reinsurers in 2003, showing that risk management practices are improving, an FSA survey found.

Coinciding with a spate of reinsurer downgrades, the survey looked at the risk management practices of 39 firms in the UK company market between January and May 2003.

The survey, which included 19 non-life insurers, was a follow-up to the FSA's 'arrow' risk assessment visits in 2002.

The survey found that the quality and timeliness of risk information being reported to boards has increased.

But the FSA is concerned that risk management systems are being developed primarily to meet its requirements, rather than to deliver effective risk management.