Who is primarily regulated by the Financial Conduct Authority (FCA)?

The Financial Conduct Authority (FCA) primarily regulates insurance companies as part of its mandate to oversee the conduct of firms and protect consumers within the financial services sector. While the FCA does have the authority to regulate banking firms and investment firms, its specific focus includes ensuring that insurance companies treat their customers fairly, adhere to appropriate sales practices, and maintain sufficient financial stability to honor their obligations.

Insurance firms must comply with various regulations that aim to promote transparency, fairness, and consumer protection. This encompasses the requirement for insurers to provide clear information about their products, handle claims efficiently, and maintain solvency so that they can pay claims when due.

The other options, while relevant to the broad scope of the FCA's regulatory authority, do not fully capture the primary focus of the FCA as it pertains specifically to insurance. Banking and investment firms fall under a broader financial services umbrella, and although the FCA regulates them, insurance companies are specifically highlighted due to the unique nature of their operations and the specific consumer protections needed in the insurance industry.