TheEuropean Parliament today approved the Solvency II framework directive without the contentious group support provisiona development described by CEA, the European insurance/reinsurance federation, as a "missed opportunity."
According to the U.K. Insider newsletter, the parliaments vote came after the Committee of Permanent Representatives (Coreper) endorsed the directive text on April 1. Formal adoption of the framework directive is expected at the Economic and Financial Affairs (ECOFIN) Council meeting, May 5.
Michael Koller, CEA director general, reportedly welcomed the parliament's plenary vote for Solvency II, describing it as "a decisive step toward the new, enhanced regulatory regime that we have been seeking for Europe's insurers."
The Insider reports that the federation is in disagreement, citing a carving out of group support from the text "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." The Association of British Insurers (ABI) also expressed disappointment when the decision was taken, said the Insider.
Phil Smart, KPMG's head of Solvency II in the U.K., expressed further concern on GAAPWeb, saying the new rules would create the need for significant regulatory changes, an issue which will be difficult for firms of all sizes.
Despite the large-scale changes firms will need to make to comply with the directive, it does offer "clarity" when it comes to the issue of Solvency II, Smart added. However, as group risk is not dealt with in the final proposals, this issue will be debated for years to come, GAAPWeb quoted him as saying.
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