THE INSURANCE industry will today throw its full backing behind a key government report set to pave the way for the industry to take on a £17bn chunk of the Treasury’s welfare state obligations.
Stephen Haddrill, director-general of insurance body the ABI, said the report should help the industry boost its strength significantly over the coming years. “Achieving the best results will depend on all the report’s recommendations, which the ABI wholly support, being implemented in full,” he said.
The Insurance Industry Working Group report, setting out a vision of how the industry should look by 2020, will today call for insurers to boost their role in “helping people with the need for retirement income and help with long-term care”.
The report is to suggest that through its state pension and welfare work the government provides 65 per cent of the insurance in the UK. If five per cent of those risks were given to private insurers, the Treasury could cut £17bn off its welfare obligations.
A source at Aviva, whose chief executive Andrew Moss co-authored the report with chancellor Alistair Darling, suggested last night that this long-term shift would require members of the public to “go private” with parts of their retirement or care insurance. This would offer commercial gains for the insurance industry and so is only likely to take place if it can find public support.
Today’s report will also call for the insurance industry to improve transparency, simplicity and access for consumers to boost consumer confidence and trust.