LONDON, April 8 (Reuters) - Britain's insurance industry hasurged its regulator to hold a fully independent inquiry into hownews of a review into the sector was released.
Shares in the sector tumbled on March 28 after the FinancialConduct Authority told a newspaper it was reviewing part of theinsurance industry, raising fears that profitability would behit.
The watchdog did not clarify its review until more than sixhours after trading had opened.
The Association of British Insurers (ABI) said in a letterto the FCA, released to the media on Tuesday, that it hasserious concerns about what appears to have been premature andselective disclosure.
The watchdog has said the investigation into its handling ofthe news would be carried out by its board with an external lawfirm, but the ABI wants an independent probe, saying thewatchdog "cannot be permitted to investigate itself".
"This is very much a situation in which even the perceptionof a lack of objectivity or thoroughness could be damaging tothe FCA and its aims," the ABI said.
(Reporting by Huw Jones, editing by Clare Hutchison)