New pan-European regulator hailed

The creation of a new pan-European industry regulator will transform the regulation of cross-border insurers, according to Euro-Parliament’s lead member on insurance.

A deal agreed last night between the European Parliament, the Council of Ministers and the European Commission creates a new body, the European Insurance and Occupational Pensions Authority (Eiopa).

Under the shake-up, Eiopa will replace Ceiops (Committee for European Insurance and Occupational Supervisors) – the umbrella body for the EU’s insurance regulators.

The Parliament's rapporteur for Eiopa Peter Skinner MEP, said: "This is a very significant day for the future of the single market in financial services in Europe. For the first time ever we have a body with the power to ensure EU rules are being followed in each Member State - this will greatly improve the integration of financial services and the financial safety of European citizens."

He said that the Parliament had won significant concessions from the national governments over the power of the new supervisory authorities, which also includes a new banking authority (EBA) and new capital markets authority (ESMA).

These included the ability to settle disagreements between quarrelling national authorities through direct contact with individual financial institutions, and to take action quickly during an emergency situation to prevent financial meltdown.

Skinner said: "Eiopa will compliment the agreement reached last year on the Solvency II legislation covering the insurance sector. It is the missing piece of the jigsaw that will allow national authorities to coordinate and communicate effectively when implementing Solvency II,".

He added that one of the Parliament’s most important successes had been the creation of a joint committee to co-ordinate the work of the new authorities the newly created European Systemic Risk Board (ESRB).

"With this innovation the Parliament has ensured that banking, insurance and capital market regulators no longer act in silos, but instead actively contribute to the assessment of macro level risk being under-taken by the ESRB."

Skinner said the creation of the new authorities represented the start of an improved approach to managing the integration of financial services across Europe.

"This is a massive step forward. It is totally necessary. It may not have prevented the previous crisis, but hopefully it will help prevent the next crisis. We will review the success of new authorities in 2014 and if appropriate, look to increase their powers. This is the start of the next phase of integration of the European Single Market in financial services.”