Planned new regime emphasises flexibility and includes options for the use of different solvency models that are most appropriate for different companies, says IUA
The draft Solvency II framework is a ‘step in the right direction’, said the International Underwriting Association (IUA).
In a statement the IUA said: “The planned new solvency regime for insurers emphasises flexibility and includes options for the use of different solvency models that are most appropriate for different companies.”
Nick Lowe, the IUA’s director of government affairs, said the association is examining the draft carefully to assess how much the London company market would benefit from the proposals. In particular the IUA is focussing on the development of lead supervision, diversification benefits and freedom of access to the European market.
Lowe commented: “We understand that the European Commission wishes to introduce an effective approach to group supervision with a lead supervisor approach that would reduce inconsistencies and unnecessary duplication in the supervision of European companies operating in more than one member state.”
“It also appears that scope will be left open for the benefits of diversification of risk within insurance groups to be recognised and that would appear to extend to subsidiaries and branches outside the EU.
“There would also be scope for creating a level-playing field between EU and non-EU licensed companies. Nevertheless, the devil is always in the detail.”
