The International Underwriting Association (IUA) has welcomed a decision by the Prudential Regulation Authority (PRA) to abandon planned changes to regulatory reporting requirements for large third-country insurance branches operating in the London insurance market.
The move follows industry consultation on proposed reforms to the PRA’s Modification by Consent process, which allows certain overseas insurance branches to benefit from adjusted reporting requirements. The regulator had previously proposed requiring the largest branches to transition to full regulatory reporting, while maintaining reduced reporting obligations for smaller firms.
In its response to the consultation, the IUA questioned the cost-benefit analysis underpinning the proposal and argued that the operational impact on affected firms could be greater than anticipated.
Following a further review, the PRA concluded that quarterly reporting by larger branches would provide limited additional supervisory benefit relative to the costs involved. In its policy statement, PS13/26 – Insurance third-country branches: policy implementation and other updates, the regulator confirmed that quarterly reporting requirements would not be introduced for any branches.
The IUA said that firms affected by the original proposal would have faced a substantial compliance burden, including information technology upgrades needed to collect, process, and submit additional regulatory data.
Nafisah Hussain (pictured), director of public policy at the IUA, said the decision demonstrated the value of consultation between regulators and industry participants.
“I am delighted that the PRA has taken on board our comments and agreed not to unnecessarily increase the reporting burden for our members,” Hussain said. “This move clearly demonstrates the value of an effective consultation process and the importance of regulators and industry working together to develop a robust but proportionate and efficient supervisory regime.”
She added that the decision supports the PRA’s secondary objective of promoting competitiveness and growth alongside its primary responsibility for financial stability.
“In addition to promoting the safety and soundness of the firms it regulates, the PRA also has a statutory objective to enhance competitiveness and growth. This decision will help ensure that the London Market remains an attractive location for international insurers,” Hussain said.
The decision comes amid a wider regulatory focus on improving the competitiveness of the UK insurance sector. The PRA has repeatedly highlighted its secondary objective of facilitating international competitiveness and growth while maintaining policyholder protection and financial stability. In its 2025-26 business plan, the regulator identified support for competitive and innovative financial markets as a key priority.
According to the PRA, its updated cost-benefit analysis found that removing the proposed reporting changes would not materially affect its primary objectives. The regulator said the decision would support its competitiveness and growth objective by reducing operational burdens on affected branches.
Third-country branches are a common corporate structure used by international insurers operating in the London market. The IUA noted that many of its members conduct business through branch offices established in the UK.
