Tag Archives: Europe

British regulator to focus more on protecting insurance policyholders

LONDON, March 20 (Reuters) – The Bank of England said it
will devote greater effort to ensuring more consistent
protection for those who would suffer most if their insurance
policies do not pay out as promised. The move follows a review by the central bank’s Independent Evaluation Office (IEO), published on Monday, which looked into
how the BoE’s supervisory arm, the Prudential Regulation Authority (PRA), ensures that policyholders are properly protected. PRA work on the issue had been “crowded out” by “live supervisory issues” and the need to implement European Union capital rules known as Solvency II by January 2016, the IEO said in its report. The PRA’s “articulation of its policyholder protection responsibilities appears to be unfinished business”, although there was no evidence that PRA supervisors were falling short of their duties, the IEO said.

BoE Deputy Governor and PRA Chief Executive, Sam Woods, said the PRA does not seek to protect all policyholders equally and will direct more resources to those who would suffer greater financial hardship if their policies do not pay out as promised.

Continue Reading “British regulator to focus more on protecting insurance policyholders” at Nasdaq News

NAIC asks Treasury secretary to review EU-US covered agreement

The National Association of Insurance Commissioners has asked the new Treasury secretary to clarify provisions of the covered agreement reached between the United States and the European Union in response to the bloc’s Solvency II directive. 

The covered agreement deal negotiated by the U.S. Department of the Treasury under the Obama administration and the Office of the U.S. Trade Representative, announced on Jan. 13, aims to address the fact that the European Commission has not deemed the United States an equivalent jurisdiction, per the EU’s Solvency II directive outlining a risk-based capital regime for insurers and reinsurers in Europe.

Continue Reading “NAIC asks Treasury secretary to review EU-US covered agreement” at Business Insurance News

Solvency II means no need for new EU insurance framework

This announcement is in response to a European Insurance and Occupational Pensions Authority (EIOPA) consultation on the potential harmonisation of frameworks for insurers.that_s_all_folks__by_surrimugge-d6rfav1

The lobby group said in its position paper that Solvency II already allows early intervention when either the Minimum Capital Requirement (MCR), or the Solvency Capital Requirement (SCR) are breached, and that this is sufficient.

It states: “Insurance Europe believes it is important to reiterate that Solvency II already provides several safeguards that…

Continue Reading “Solvency II means no need for new EU insurance framework” at The Actuary

Solvency II complicates captive strategies

The implementation of Solvency II in Europe has provided an additional risk management tool to owners of European captives, but at a cost, forcing risk managers to re-examine whether they are getting the best use out of their captives.confused-face-484x295

Solvency II, the European Union-wide risk-based capital rules for insurers and reinsurers, came into force in January 2016, and with it came new elements that have affected captives, for better or for worse.

“What we’re seeing as managers is an increased interest in strategic reviews and companies re-examining the captives to explore optimization opportunities and thus potentially…

Continue Reading “Solvency II complicates captive strategies ” at Business Insurance News

Buyouts more affordable but only for a handful of schemes

Buyouts have become more feasible as annuity pricing for non-pensioners has improved, but some experts say many schemes still have a long way to go before being able to afford a buyout or buy-in transaction.GettyImages-99978274.0

Research conducted by consultancy LCP shows that around 1m people had their defined benefit pension insured through a buy-in or buyout, as insurers started to find their feet following the introduction of Solvency II.

More recently, the Cancer Research UK Pension Scheme completed a £250m pensioner buy-in with Canada Life as part of the scheme’s plan to reduce risk, including an introduction last year to liability-driven investing.

Continue Reading “Buyouts more affordable but only for a handful of schemes” at Pensions Expert News

Deal or no deal? US divided on EU insurance agreement

On the face of it, the insurance covered agreement announced on January 13 should be everything Donald Trump detests. Signed in the final days of Barack Obama’s administration, when Trump had already been elected, the deal is between the US and the European Union – an institution the new president has repeatedly disparaged.1343

It will pre-empt the authority of individual US state legislators and require them to defer to EU regulation of European insurers in US markets.

On top of that, the agreement was negotiated by the Federal Insurance Office (FIO), an Obama-era creation Republican lawmakers are keen to abolish.

Continue Reading “Deal or no deal? US divided on EU insurance agreement” at Risk.net

PRA says insurers exaggerating Solvency II problems – report

Prudential Regulation Authority (PRA) chief executive Sam Woods has reportedly told parliament that insurance companies are overstating the issues regarding Solvency II.4088135-blow-me-funny-quotes

Woods said on Wednesday before the parliament’s Treasury Select Committee that Solvency II is “basically a sensible regime,” Reuters reported.

However, he admitted that Solvency II, which sets out capital rules for EU insurers, needs some changes.

Continue Reading “PRA says insurers exaggerating Solvency II problems – report” at Insurance Business News

State insurance regulators may flex muscles amid federal rollback

Talk of a lighter regulatory touch out of Washington has many in the financial services industry feeling optimistic; but for insurers, there may be reason to be wary of the ‘law of erin-borchard-list-of-functional-exercises-LIaJas-clipartunintended consequences.’

A potential repeal, or rollback, of the Dodd-Frank Act may seem like a step toward lower regulatory burden, but in reality, only a handful of insurers — those designated as systemically important financial institutions (SIFIs), and those that own a depository institution — would feel its impact.

While few insurers are directly affected by the federal bodies established by Dodd-Frank — notably the Financial Stability Oversight Council (FSOC) and Federal Insurance Office — they are all regulated by the states, which have historically taken the lead on overseeing the insurance industry.

Continue Reading “State insurance regulators may flex muscles amid federal rollback” at The Hill

Bank of England defends implementation of Solvency II rules

The Bank of England has dealt a blow to UK insurers hoping for a quick fix to what they see as the most onerous aspects of EU capital requirements.

The insurance industry has been campaigning for a more lenient indexinterpretation of EU rules known as Solvency II. Some insurers have accused the central bank of “gold plating” the regulatory regime, which is supposed to be applied equally across the EU.

But in a speech to the Association of British Insurers on Tuesday, David Rule, the BoE’s head of insurance supervision, said its implementation of Solvency II had been “robust but proportionate” and played down the potential for immediate changes.

Continue Reading “Bank of England defends implementation of Solvency II rules” at Financial Times

Pensions: IORP II and the elephant in the room

After almost two years of negotiation, the revised European Union Directive on the Activities and Supervision of Institutions for Occupational Retirement Provision (IORP II) comes into effect today.newPic_4681_jpg_3388340b

Member States will now have two years to incorporate it into national law.

But what is IORP II? How will it impact on occupational pension provision in the UK? And what about the elephant in room – Brexit?

Background

IORP I came into effect in 2003, and lays down rules for activities carried out by IORPs (which, in the UK, are broadly employer-funded occupational pension schemes).

Continue Reading “Pensions: IORP II and the elephant in the room” at Lexology