"For the last 2.5 years a second reform of insurance supervision has been made in Russia. On March 4th, 2011 the Federal Insurance Supervision Service has been attached to the Federal Financial Markets Service of Russia, and starting September 1st, 2013 the Federal Financial Markets Service of Russia were transferred to the Central Bank of the Russian Federation (represented by the Financial Markets Service of the Bank of Russia)," said Andrey VESELKOV, General Director, Media-Information Group, "Insurance Today", Russian Federation.
According to Andrey VESELKOV, the reason for such a transformation was the success of the Central Bank of the Russian Federation in regulating the Federal Financial Markets Service. Bank supervision is fairly effective and strict. The Central Bank has more resources and authority. Expectations of the financial experts following the appointment of a new regulator are different.
Some market participants fear that the insurance market will be not sufficiently interesting and important for the Central Bank as an object of regulation due to the relatively small volume (compared to the bank).
"The reason of such fear shows the recent experience of the merger between the Federal Insurance Supervision Service and the Federal Financial Markets Service - except the introduction of penalties for insurers. The other significant changes in the system of supervision were not observed," explained Andrey VESELKOV.
VESELKOV has been speaking for many years about the need for prudential supervision of the insurance market for some time, still the Federal Financial Markets Service wasn't the one to implement it. Other insurers are hoping that the Central Bank can still start the system of prudential supervision, and along with other already introduced or imposed measures (development of a system of self-regulation in the insurance, the transition to reporting according to international standards (IFRS), the introduction of independent actuaries, etc.), this will considerably strengthen and improve the market, helping to overcome the crisis tendencies.