After months of wrangling, European politicians have now reached an agreement on the implementation of Solvency II. Eversheds believes that the deal will bring relief to the insurance industry.
Jeremy Irving, partner and insurance expert at the law firm, said: ‘The EU’s failure to implement Solvency II in accordance with its original timetable had left many insurers “all dressed up” at huge expense, “with nowhere to go” in attempting to comply with the rules. The insurance industry and regulators in various member states, not least the UK, have been critical of the difficulties raised by the attempts of political bodies to apply detailed prescription to substantial — in some cases huge — complex and sophisticated economic entities and operations.’
According to Irving, it remains to be seen whether Solvency II will have only those positive benefits for which its promulgators hoped. ‘It is possible that it will have some consequences that are potentially adverse for European insureds, intermediaries and even insurers, especially with the forces at play in the global digital economy. However, for the time being at least, there is greater clarity on the process moving forward.’