BoE powers to oversee insurers ‘may not offset risks posed by looser regulation’

The Bank of England and the Treasury have disagreed over the potential risks of Solvency II reforms. Photograph: Graham Turner/The Guardian

Moves to hand the Bank of England fresh powers over insurers will not be enough to offset the risks posed by looser regulation, one of the central bank’s most senior officials has warned.

The comments by the chief executive of the Bank’s regulatory arm, Sam Woods, come a day after his boss and the Bank of England governor, Andrew Bailey, said that reforms to so-called Solvency II regulations would increase the possibility of life insurance firms failing by 20% in a given year.