Which of the following best describes the purpose of the PRA?

The purpose of the Prudential Regulation Authority (PRA) is best described by maintaining overall financial resources. The PRA, which is part of the Bank of England, focuses on ensuring the safety and soundness of financial institutions, including insurance companies, through robust supervision and regulation. This involves assessing the financial health of these institutions, ensuring they have adequate capital and liquidity to withstand financial shocks, and promoting the stability of the financial system as a whole.

This focus on financial resources is critical because it helps mitigate the risk of insolvency and protects policyholders and the wider economy. By maintaining sound financial practices among regulated firms, the PRA helps foster confidence in the financial system.

While promoting competition and regulating premiums might be considerations within a broader economic context, the PRA's primary legislative mandate is not explicitly aimed at these goals. Employee welfare, although important for any organization, falls outside the scope of what the PRA is designed to address. As such, maintaining overall financial resources aligns directly with the overarching objectives of the PRA.