RegTech in Insurance: How Compliance Teams Keep Up with Regulatory Change

Oversight Has Become a Continuous Obligation

Consumer Duty, anti-money laundering (AML) rules, ESG reporting and delegated authority governance all point in the same direction. You must show not just that you checked a counterparty once, but that you know who they are, what they are doing and whether anything has changed, at any point in the relationship. The FCA has issued £4.77bn in fines since 2013, and failures of oversight and financial crime controls feature heavily among them.

The hard part is not the first check. It is keeping counterparty information accurate across the full life of a relationship, through renewals, ownership changes, new appointed representatives and shifting sanctions lists. Many firms still run that work on manual processes and disconnected systems, which means records drift out of date between reviews and evidence is assembled in a rush when an auditor asks for it.

Regulatory technology, or RegTech, closes that gap. The sections below set out where it helps, who benefits most and what the move from reactive to proactive compliance looks like in practice.

What RegTech in Insurance Actually Means

In insurance, RegTech is software that automates and records the compliance work around your counterparties: onboarding, Know Your Customer and Know Your Business (KYC/KYB) checks, PEPs and sanctions screening, Terms of Business Agreement (TOBA) management and ongoing monitoring. The point is not to replace your compliance team’s judgement. It is to give that team accurate, current information and a clear audit trail, so their time goes on decisions rather than data gathering.

Insurance has its own version of the problem because of how distribution works. An insurer may rely on dozens of MGAs, which appoint hundreds of brokers, each with their own directors, owners and appointed representatives. Generic GRC tools rarely reflect that chain. Insurance-specific platforms such as REG Network are built around it, screening companies, individuals, ultimate beneficial owners and directors, and keeping that picture up to date as the relationship runs.

The Regulatory Pressures Driving Adoption

Consumer Duty requires firms across the distribution chain to show they deliver good outcomes and fair value. That is impossible to evidence if you cannot see who sits further down the chain or how they are performing. Delegated authority adds a further layer: Lloyd’s and capacity providers expect coverholder oversight to be documented, current and regulator-ready, not reconstructed at audit time.

At the same time, AML and sanctions obligations have tightened, and screening a counterparty once at onboarding no longer reflects the risk. Ownership changes, directors are appointed, new names appear on sanctions lists. The FCA’s direction of travel, including PS26/2 on material third-party arrangements, points towards continuous oversight rather than periodic review. If your firm is preparing for it, the PS26/2 readiness check is a quick way to see where the gaps are.

Together, these demands mean more evidence, more often, across more relationships. Headcount alone does not scale to meet that, which is why compliance leaders are turning to technology.

9 Problems RegTech Helps Insurance Firms Solve

The value of regtech shows up in specific, everyday tasks. These are the nine areas where firms see the clearest difference.

1. Automating due diligence workflows

Onboarding, verification and periodic review involve the same checks repeated across every counterparty. Automating them removes the copy-and-paste work and makes sure each check runs the same way every time, whoever is doing it.

2. Centralising compliance records

When documents, approvals and activity sit in inboxes, shared drives and spreadsheets, nobody has the full picture. A single source of truth means your team, your auditors and your board all look at the same, current record.

3. Monitoring counterparties continuously

A counterparty that was clean at onboarding may not be clean six months later. Continuous monitoring flags changes to ownership, directors, sanctions status or adverse media as they happen, rather than at the next scheduled review.

4. Identifying operational risks

Gaps in governance tend to hide in the detail: an expired TOBA, a missing document, a broker whose permissions have changed. Real-time visibility across the portfolio brings these to the surface before they become findings. For firms that need configurable thresholds by geography, sector or risk appetite, REG Risk 365 adds that layer on top of REG Network.

5. Improving audit readiness

Auditors and regulators want to see what was checked, when, by whom and what happened next. A platform that records this automatically turns audit preparation from a scramble into a report.

6. Reducing manual administration

Chasing documents by email and tracking renewals in spreadsheets consumes hours that compliance teams cannot spare. Automated requests, reminders and shared document exchange, such as REG Exchanges, take most of that load away.

7. Strengthening governance frameworks

Consistent workflows mean consistent oversight. When every counterparty goes through the same process, accountability is clear and exceptions are easy to spot.

8. Responding to regulatory change

New obligations arrive faster than policy manuals can be rewritten. A configurable platform lets you add a check, change a review cycle or request new information across your whole network without rebuilding the process.

9. Scaling without adding headcount

Growth usually means more brokers, more coverholders and more due diligence. Automation lets you take on more counterparties without a matching rise in compliance workload, so growth and control stop pulling in opposite directions.

Who Benefits Most from RegTech in Insurance

The pressure lands differently depending on where you sit in the distribution chain.

Compliance and risk leaders

You are accountable for oversight of firms you cannot see directly, and you need evidence you can stand behind when the regulator or the board asks.

Insurer and carrier distribution teams

Your risk is spread across many delegated authority relationships, each of which has to be onboarded, monitored and reviewed.

MGA founders and operations teams

Every new broker appointment brings more due diligence, so growth creates compliance work unless the process scales with you.

Broker management teams

Each insurer has its own forms, TOBA and renewal cycle, so you spend much of your time supplying the same information repeatedly. A shared network, where a firm’s verified information can be reused across relationships, reduces that duplication on both sides.

Why MGAs Moved First

MGAs have less legacy infrastructure, smaller teams and shorter decision chains than most carriers, so they can adopt new technology faster. A 2023 Clyde & Co report found that MGAs were investing in technology at a markedly higher rate than carriers.

The MGAs that moved early embedded compliance directly into how they manage delegated authority. They automated broker due diligence, generated real-time audit trails and produced regulator-ready reporting on demand. That put them in a stronger position as Lloyd’s and the FCA raised expectations on fair value, Consumer Duty and coverholder oversight, and it made them easier partners for capacity providers to work with.

What Changed for Firms That Made the Switch

The clearest evidence comes from firms already using the platform. At CNA Hardy, the change showed up in faster broker onboarding and same-day TOBA completion.

For Arc Legal, the benefit was round-the-clock oversight and confidence at audit.

Lorega found that a shared, structured process improved its broker relationships.

More examples are on our case studies page.

Wrapping Up

Regulators no longer accept a one-off check as evidence of oversight. Consumer Duty, delegated authority governance, AML and the FCA’s focus on third-party arrangements all expect firms to know their counterparties continuously and prove it on demand.

Firms that keep relying on spreadsheets and email will find that standard harder to meet with every new rule and every new relationship. Those that automate due diligence, centralise their records and monitor counterparties in real time move from reactive compliance to embedded, proactive oversight, and they free their teams to focus on the judgements that matter. The MGAs that moved first have shown what that looks like. The rest of the market now has a clear path to follow.