EU-level regulation
of insurance companies
must be simplified
- Insurers’ existing solvency requirements must be eased and simplified.
- Insurers’ reporting burden must be reduced.
- Further development of insurers’ solvency and crisis management regulation must avoid overlaps and redundancies.
- The review must not result in unnecessarily stricter solvency regulations, which could hamper the promotion of sustainable finance.
The solvency of insurance companies is regulated at EU-level with the Solvency II directive. It provides a prudential framework that harmonises insurers’ solvency provisions, calculation of technical requirements, and supervision of solvency in the EU. The directive also sets out qualitative requirements for governance, to ensure that the regulatory framework is combined with each undertaking’s own risk-management system and informs business decisions. Solvency II is already in force, but its contents are being reviewed in 2021. The Commission and EIOPA are also considering the development of insurers’ crisis management separately from the Solvency II.
The Solvency II review is headed in the right direction – some course adjustment still required (29 Sep 2021)
Solvency II rationalised risk assessment but imposed a massive reporting burden on insurers (7 Jun 2021)
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