From from 1st April 2013, the Financial Conduct Authority began the regulation of General Insurance, taking over from the Financial Services Authority. It is a legal requirement for all individuals and companies (with a few exceptions) that trade in insurance to be registered with the FCA and adhere to their rules.
The FCA has imposed stringent requirements, such as status disclosure, solvency, controls in handling client money, record keeping etc. in an attempt to protect consumer's interests. Part of this protection includes the possibility of compensation when things go wrong, through the Financial Services Compensation Scheme (FSCS)
The FSCS is the UK's statutory fund of last resort for customers of financial services firms. This means that FSCS can pay compensation to consumers if a firm is unable, or likely to be unable, to pay claims against it.