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Regulation Trends in Post-Crisis Europe - Key Developments and Influences on Insurance Market

Explore post-crisis changes in regulation impacting the insurance market in Europe, including international convergence, stability focus, supervisory architecture, and prudential requirements. Learn about global financial stability policies, EU supervisory framework, financial sector contributions, Solvency II directive, and increased consumer protection measures.

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Regulation Trends in Post-Crisis Europe - Key Developments and Influences on Insurance Market

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  1. After the crisis: Changes in Regulation in Europe... - the most important trends and influences upon the insurance market Michaela Koller, director general, CEA Budapest, 05 October 2010

  2. Key developments post-crisis • International convergence: new emphasis • Stability: new core focus • Systemic relevance • Supervisory architecture • Tax/levies/funds • Prudential requirements: increasing • Conduct of Business Rules / Consumer Protection: increasing

  3. A global post-crisis agenda • Globally shared policy objectives • Global financial stability • Strengthened supervisory and regulatory regimes • Industry contribution to crisis prevention ./. Taxpayer • Key outcomes determined at G20 level •  Stronger role of international for a such as • Financial Stability Board • Joint Forum: • Basel Committee, • International Association of Insurance Supervisors • IOSCO • IMF

  4. EU supervisory architecture New European supervisory authorities • European Systemic Risk Board - macro-level supervision • Will identify risks to financial stability • Will issue warnings and recommendations • European Supervisory Authorities – micro-level supervision • Binding powers • Can take decisions on companies in certain circumstances • Will draft (binding) technical standards • Will assess systemic importance • Will develop criteria to establish a stress testing regime • Timeline • New architecture in place in 2011

  5. Financial sector contribution to the crisis Fast-moving target: at all levels G20 – EU - national debates G20 to decide at next summit in November IMF recommends options that would include the insurance industry Financial stability contribution Financial activities tax

  6. Financial sector contribution to the crisis EU Council Political push towards a financial sector tax / levies European Commission parallel initiatives Crisis management regime, including resolution funds Discussions focused on banks – but to be extended to insurers Bank levies Transaction tax – “innovative financing” European Parliament Recurrent requests to EC and Council to move forward on a broad basis EU: no agreement on “stability fund” or a central IGS in the context of the new supervisory architecture

  7. Solvency II – increased capital requirements?!? • Solvency II Directive agreed • Appropriate answer to the crisis for the insurance sector • Implementing measures under development • Concerns over Ceiops advice • Need for data – QIS 5 instrumental • QIS 5 exercise • EC corrected Ceiops original advice to some extent • Further correction required • Call for high participation • Timing

  8. Increased consumer protection • Distribution and selling practices • Packaged Retail investment products • Insurance Mediation Directive • Insurance Guarantee Schemes

  9. www.cea.eu

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