The Financial Markets Authority (FMA) – Te Mana Tātai Hokohoko – has released its annual report for the financial year ending June 30, 2025. The report details the FMA’s evolving strategy and enforcement activities, which are expected to have direct implications for insurers’ compliance responsibilities and operational processes.
The FMA’s annual report, tabled in Parliament, sets out the regulator’s strategic objectives for the year, including a shift toward outcomes-focused and intelligence-led regulation, as well as efforts to deter unregulated activities and prevent misleading practices. Core functions such as licensing, monitoring, investigation, enforcement, and policy development remain central to the FMA’s mandate.
FMA chief executive Samantha Barrass said, “This year has seen tangible differences made in the pursuit of our statutory purpose of promoting and facilitating the development of fair, efficient, and transparent financial markets.”
The report highlights several initiatives relevant to insurers. Among these is the implementation of the Conduct of Financial Institutions (CoFI) legislation, which brings day-to-day conduct regulation to insurance providers. Beginning March 31, financial institutions in New Zealand are required to comply with the CoFI regime. This regulatory framework mandates that each institution establish a documented fair conduct programme. The purpose of these programmes is to ensure customers receive consistent treatment at every stage of their relationship with the institution, covering areas such as onboarding, claims processing, and handling complaints.
Additional activities included working with the Ministry of Business, Innovation and Employment (MBIE) on capital markets reform and scam prevention, as well as granting exemptions to reduce unnecessary regulatory burdens. The FMA also made preparations for the Contracts of Insurance Act 2024, which updates the legal framework for insurance contracts in New Zealand.
Financial performance and operational focus
Barrass noted that the FMA’s enforcement actions demonstrate its ongoing focus on consumer outcomes. She also pointed to the authority’s efforts to improve financial discipline and prioritise resources. “The net deficit for this year is lower than budgeted, primarily due to higher-than-expected revenue and lower overall operating expenditure. We have achieved or substantially achieved nine out of 12 SPEs. Our targets and our performance were raised, so in some cases we did not meet our targets despite improved performance. Where we have not achieved our targets, we will focus on continuing to lift our results,” Barrass said.
Industry feedback and engagement
In addition to the annual report, the FMA released its 2025 Ease of Doing Business (EODB) survey, which gauges industry sentiment and stakeholder experiences. The survey is part of the FMA’s ongoing performance measurement and is used to inform its regulatory approach. For insurers, the survey results can signal potential changes in regulatory expectations or processes that may affect compliance obligations, operational procedures, and interactions with the FMA.
Barrass commented, “After a decline across a number of key indicators in last year’s 2024 EODB survey and a year of hard work and extensive industry engagement, we are pleased to see better results from this year’s survey. We are on track, and [we] aim to continue this momentum, reflecting on feedback received from the survey and from stakeholders throughout the year to further enhance our industry engagement.”
The 2025 survey results show improvements in several areas, including communications and engagement. The proportion of respondents who found FMA communication clear and effective increased from 63% in 2024 to 74% in 2025. The percentage of stakeholders who believe the FMA’s actions help raise market conduct standards rose to 82%, although this remains below the FMA’s target of 90%.
Survey responses also indicated a greater perception that the FMA is focused on outcomes that matter for consumers and markets, and that its regulatory approach is supportive of industry. However, only 55% of respondents agreed that the FMA has streamlined systems and processes for licensed entities, up from 48% last year. The proportion of stakeholders who found it easy to do business with the FMA improved to 56%, compared to 53% in 2024.
Ongoing improvements and future direction
Barrass acknowledged areas for further improvement, particularly in systems and processes. “We are committed to improving and modernising our systems, to uplift performance and support new features,” she said. Planned initiatives include automating key processes, enhancing the FMA website with AI-powered search, and simplifying licensing for entities with multiple licenses.
The FMA also noted a decline in stakeholder confidence and perceptions of market integrity, with respondents divided between those seeking stronger enforcement and those favouring lighter regulation. The 2025 survey received 599 responses, representing a 25% response rate. Results were weighted to ensure they accurately reflect the stakeholder base.
The FMA said it will continue to use feedback from the survey and ongoing engagement to inform its regulatory approach and support the ongoing development of New Zealand’s financial and insurance sectors.
