Aon believes U.K. insurance plans will benefit from proposals to relax regulations on insurer investment portfolios, in its response to a government consultation.
Aon, an insurance and professional services firm, said the proposed changes may support competitive bulk annuity pricing as insurers take advantage of asset opportunities that have a short window in which to invest during pension risk transfer deals.
Having been open to responses from April 8, the consultation led by the Prudential Regulation Authority has proposed a Matching Adjustment Investment Accelerator, which will look to reduce barriers to rapid investment by insurance firms.
Under the proposals, firms with an MAIA permission will have 24 months to submit a formal application on eligible assets with new features, reducing the risk that firms miss out on time-sensitive investment opportunities.
“This innovation will enable insurers to make more rapid investment decisions and support growth in the U.K. economy, while protecting policyholders,” said Sam Woods, CEO of the PRA, in a news release.
The proposal builds on those introduced by reforms made to Solvency II in October, legislation that oversees what investments an insurer can hold in its portfolio.
The U.K. government has told all regulators to consider options to support investment in the U.K. economy and ultimately boost economic growth, and that this proposal from the PRA “is clearly part of this remit,” according to Aon’s consultation response.
Responses to the consultation are due by June 4.
