ABI boss says he knew of insurance review for months

He also confirmed that The Telegraph called the afternoon before the publication of the story to “comment” on various points.

However, Mr Thoresen said he “still hadn’t seen the substance” of the review or the FCA’s business plan so did not anticipate the violence of the market reaction.

Today the FCA said it had appointed Simon Davis, a senior partner at Clifford Chance, to head up the external review into its handling of its announcement. The lawyer has been tasked with establishing if there was “an appreciation” at the FCA that news of its review was price sensitive and why its “clarificatory statement was issued so late during the day after the story was published rather than Thursday night.”

Mr Thoresen told MPs that in hindsight, the news was the “final thing” for investors holding insurance stocks after the radical reforms announced in the Budget and the charge cap on workplace pensions revealed just the day before. He said the Budget reforms, which the Chancellor declared “no one will have to buy an annuity”, was a “genuine surprise” for the industry.

The TSC published two letters written by the ABI to the Chancellor and the FCA last week that raised “serious concerns” about the regulator’s handling of the episode.

The letters, written by Otto Thoresen and Tidjane Thiam, director general and chairman of the ABI respectively, called for more “joined up policymaking” from the Government and the City watchdog.

The ABI said the industry wanted a “higher level and longer-term dialogue with the Government and regulators on savings policy”.

“With so many initiatives and changes in our market, it is more important than ever to have a joined up policymaking,” they said and authorities that were working “hand in hand” with the industry.

Mr Thoresen told MPs that insurers needed “a relationship of trust between the regulator, the industry and the Government”.

“What we have had in this period has not been helpful towards that,” he said.

He said that insurance sector was a “socially important industry” and needed the regulator to be “fair, balanced and subjective”.

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