European regulators advise on Solvency II capital rules

Posted On: Nov. 03, 2009 12:33 PM CENTRAL


Adrian Ladbury

FRANKFURT, Germany—The Committee of European Insurance and Occupational Pensions Supervisors has issued a third set of advice on how it believes Europe’s planned new capital adequacy regime Solvency II should be implemented.

CEIOPS, the Frankfurt-based committee that advises the European Commission on the detail of the Solvency II directive, said that, in particular, it would like anyone affected by the directive to advise on ways in which it has suggested capital requirements should be calculated. The changes are due to be implemented in 2012.


In addition, CEIOPS commented on how the new capital requirements should be applied to captives and on the definition of captives that will qualify for simpler, less onerous capital and reporting requirements.

According to CEIOPS, only captives that insure or reinsure solely the risks of their parent group should qualify for the simplified requirements, though it allows for various definitions of those risks.

Captives that insure third-party risks, which is common even among pure captives, should not qualify for the simplified requirements, according to CEIOPS.

CEIOPS seeks comments on the advice by Dec. 11.

Two sets of advice also have been finalized and will be submitted to the commission this month, added CEIOPS.

http://www.businessinsurance.com/article/20091103/NEWS/911039991