The Financial Conduct Authority (FCA) will begin tackling legacy issues in the life insurance and pensions market early next year.
Its aim is to reduce the regulatory barriers insurers face, it said.
The initiative was announced in the regulator’s Mutuals landscape report, jointly published with the Prudential Regulation Authority (PRA).
Although the report highlighted legacy elements specific to the mutuals sector, it appears the legacy review will cover wider aspects of the life insurance and pensions sector.
“The FCA heard from industry about challenges in implementing certain aspects of the approach to with-profits funds set out in COBS 20 in the FCA Handbook, and in early 2026, the FCA plans to start work on broader legacy issues in the life insurance and pensions market with a view to reducing any regulatory barriers,” it said.
The FCA will engage in wider dialogue with mutual insurers on these topics, it added.
Mergers and acquisitions were also raised by mutual as part of the review process and this will be addressed too.
The PRA intends to publish guidance on Part VIII transfers to help mutual insurers better understand the process, costs and simplifications that the FCA currently applies, thus reducing barriers to firms looking to merge or consolidate, it added.
