The greatest risk facing the insurance industry is the raft of new regulations being introduced simultaneously at international and local levels, according to a new survey which ranks insurance sector risk. The CSFI's latest Insurance Banana Skins survey, conducted in association with PwC, says that new rules governing issues such as solvency and market conduct could swamp the industry with costs and compliance problems. It could also distract management from the more urgent task of running profitable businesses at a time when the industry is already under stress. The survey polled nearly 500 insurance practitioners and industry observers in 40 countries to find out where they saw the greatest risks over the next 2-3 years. Regulatory risk emerged a clear leader in all major markets, including North America, Europe, Middle East/Asia and the Far East/Pacific. The EU's Solvency II Directive, due for implementation by the end of this year, was the focus of strongest concern. But the survey also identified new international reporting standards, the UK's review of retail distribution practices and other tax and regulatory initiatives as swelling a heavy agenda. Other high-ranking concerns revealed by the survey include the availability of capital to meet tougher regulatory requirements, and the uncertain state of the world economy and financial markets. These are adding to the pressures on an industry which is being squeezed by low interest rates and intense competition. A strong riser in this year's ranking of 26 risks was the incidence of natural catastrophes, a reaction to recent disasters in New Zealand and Japan. Also rising strongly is political risk, a consequence of events in the Arab world, plus growing concerns about the solvency of eurozone countries. A new entrant is the shortage of talent which emerged as a major issue in all regions. On the other hand, a n