On Monday 29 January, the Committee on Economic and Monetary Affairs (ECON) formally approved the agreement provisionally reached with the Council of the EU last December (see EUROPE 13314/14) on a revision of the solvency regime applicable to companies in the insurance sector (‘Solvency II’) and the implementation of a harmonised framework for recovery in the event of insurance company insolvency (‘IRRD’).
Approved by a large majority (30 votes in favour, none against and 4 abstentions), the text provides for a revision of the ‘Solvency II’ directive, which will make it possible to release funds that insurers were previously obliged to keep in reserve. The cost of capital rate, which determines the level of reserves, will therefore be reduced to 4.75%, compared with 6% previously. The objective is to enable the sector to devote more funds to economic recovery, and in particular to the European Green Deal.
The new recovery framework (‘IRRD’) will give the European Insurance Authority (EIOPA) a coordinating role. It also aims to ensure a level playing field between Member States and to protect the interests of policyholders.
The final compromise was examined by the Member States’ ambassadors to the EU (Coreper) on Wednesday 24 January, but a legal-linguistic amendment has since had to be made.
On Monday, following the vote in the ECON Commission, the European Parliament’s rapporteur on this dossier, Markus Ferber (EPP, German), called on the EU Council to finalise this technical detail as soon as possible. (Original version in French by Bernard Denuit)