CEA welcomes informal agreement on Solvency II Framework Directive

The CEA, the European insurance and reinsurance federation, is delighted that informal but unanimous agreement has been reached at political level in Europe on the text of the proposed Solvency II Framework Directive after prolonged negotiations.

"This is a decisive step towards the new, enhanced regulatory regime that we have been seeking for  Europe's  insurers,"  said Michaela  Koller,  CEA  director  general.  "We  are  happy  that  the timetable for implementing the Directive is on track. Solvency II is an important and timely piece of  legislation  and  any  delay  would  have  been  most  unfortunate  in  the  current  economic climate."
 
The CEA, however, feels that carving out group support from the text agreed means that Europe has missed  the opportunity  to  introduce a  tool  that would have met  the need  for  the efficient and  effective  supervision of multinational groups which was highlighted  last month  in  the De Larosière Group's report on financial supervision. "The  industry  looks forward to Europe taking this step as soon as possible," said Alberto Corinti, deputy director general of the CEA.
 
The  text of  the  Framework Directive agreed  informally  today by  the Committee of  Permanent Representatives is expected to be formally endorsed next week. The European Parliament will put the Directive  to a plenary vote on 22 April. Formal adoption of  the Framework Directive  could then take place during the 5 May Economic and Financial Affairs (ECOFIN) Council.
 
"The CEA  stands  ready  to  continue  contributing  to  the work on  the  Level  Two  implementing measures  of  the Directive,  to  ensure  that  the  best  possible  framework  for  the  supervision  of Europe's insurers is achieved," said Corinti.
 
Background
Solvency  capital  requirements  for EU  insurers have been  in place  since  the 1970s.  Following a review  required  by  the  third  generation  Insurance  Directives  of  the  1990s,  limited  reforms, known  as  Solvency  I, were  agreed  by  the  European  Parliament  and  the Council  in  2002.  The European  Commission  adopted  the  Solvency  II  proposal  for  a  more  fundamental  and  wider ranging review in July 2007 and an amended proposal on 26 February 2008.

The CEA is the European insurance and reinsurance federation. Through its 33 member bodies, the national insurance associations, the CEA represents all types of insurance and reinsurance undertakings, eg pan-European companies, monoliners, mutuals and SMEs. The CEA, which is based in Brussels, represents undertakings that account for approximately 94% of total European premium income. Insurance makes a major contribution to Europe's economic growth and development. European insurers generate premium income of EUR 1,122bn, employ one million people and invest more than EUR 7,200bn in the economy.