"Reinsurance companies from all over the world that operate in Israel frequently express astonishment over the strict and extensive regulation of the insurance industry here which exists nowhere else in the world. Regulation here intervenes in the management of insurance business, shackling insurance companies in every way possible, including in pure business that has no consumer effect," said Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) president Gideon Hamburger in a speech at the "Adif" Fifth Elementary Insurance Convention.
Hamburger continued to lambast the Ministry of Defense Capital Markets, Insurance and Savings Supervision Department, saying, "The risk inherent in such tight and extensive regulation is that the regulators are not responsible for the business results of the insurers. This creates a situation in which those who dictate the rules and norms bear no business responsibility. Regrettably, the Knesset has recently been swept by populist legislation that unnecessarily burdens insurers. I am referring to, among other things, the bill for executive enforcement."
Deputy Supervisor of Capital Markets, Insurance and Savings Lee Dagan said in response, "The Supervisor of Insurance tries to intervene in the insurance market as little as possible, but when it sees a failure - it does not hesitate and it intervenes."
Dagan warned that as far as the Ministry of Finance is concerned, there is much more that has to be done in the insurance market. "Some policies at some insurance companies include very problematic conditions - unfair, opaque, unclear, or which contravene the law."
Published by Globes [online], Israel business news - www.globes-online.com - on April 7, 2011
© Copyright of Globes Publisher Itonut (1983) Ltd. 2011