Andrew Bailey, head of the UK Prudential Regulation Authority, is concerned about the EU's Solvency II capital-adequacy rules for insurers. "Although there is still much to be negotiated, a principal concern is that Solvency II will be accompanied by over-prescriptive rules," Bailey wrote in a letter to Andrew Tyrie, chairman of the UK Parliamentary Commission on Banking Standards. Bailey also notes that the rules could cost UK insurers as much as &pounds;200 million annually.

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