There is no doubt that regulation is vital to keep the financial system stable regulation helps to make sure that companies carryout their business to a high standard while also ensuring that consumers and policy holders are protected. It is however interesting to note that despite all the regulation, consumers are still losing out. Does it mean more regulation is needed? The answer is NO. Experts believe that it is time for insurance regulatory agencies to embrace better supervision to check how regulation is applied in practice and learn how to maintain the regulatory frame work.
Regulators must take into account that insurance products and distribution channels are changing all the time and adjust their guidelines accordingly. It is through supervision that regulators can monitor how a regulation works in practice and if its application is consistent across all insurance companies.