Cash plan provider Healthsure has asked the General Insurance Standards Council (GISC) and the Financial Services Authority (FSA) to treat small insurance companies as special cases.
It feels regulations are designed for the larger insurance companies and will impact unfairly on the customers of not-for-profit organisations.
Healthsure hopes the two will follow the lead of the Financial Services Ombudsman (FSO), which has taken into account the concerns of not-for-profit insurers like itself.
Healthsure said it had contacted the GISC about setting a date for a crunch meeting to discuss the issue.
The GISC wants to register all the companies collecting money on Healthsure's behalf as subagents.
Healthsure's financial director, Steve Jallands, said this meant Healthsure would have to regulate companies that were unconnected to the insurance industry.
He said: “The majority of our members pay by payroll deductions.”
As GISC rules stand, this means the companies making the payments on behalf of their employees count as subagents of Healthsure and thus would need to be monitored by Healthsure.
He also expressed concerns over the FSA's interpretation of the regulatory framework and how small firms would be regulated in practice.
The FSA's rules allow for it to send in skilled professionals, such as lawyers, actuaries and accountants and for the cost of their reports to be charged to the company under scrutiny.
Jallands said: “Obviously this could be a major cost for us.”
The FSO dealt with cash plan providers' concerns about the fees needed to defend cases brought against them, which were more than the average payout on cashplans
The FSO reacted by allowing the providers group membership through the British Health Care Association.
Jallands said: “They moved fast and adapted their rule framework. They were flexible and listened to what we were saying.”
