The European Parliament has joined calls to delay the implementation of Solvency II until 2014. This follows a recommendation from the European Council in June which said insurers needed more time to adjust to the new capital adequacy and risk management requirements.
The implementation date is currently set to be 1 January 2013, but the EP’s Economic and Monetary Affairs Committee’s draft Omnibus II text differs from this European Commission stipulation. The committee’s text says:
“Between 1 January 2013 and 31 December 2013 insurance and reinsurance undertakings and supervisors shall take all measures necessary to comply as of 1 January 2014 with the national laws, regulations and administrative provisions implementing this directive.”
European Commission internal market commissioner Michel Barnier previously appeared to rule out a delay to the directive, despite calls from the insurance industry.
Paul Clarke, global Solvency II head for accountancy firm PWC, said:
“This is a positive development as it brings us closer to ending the distracting debate over whether there will be a delay. Despite the delay in start date, the reality is insurers cannot afford to be complacent with their plans as they will still be required to file Solvency II information over the course of 2013 to prove their readiness. This means insurers will need to have the appropriate systems and processes in place by the end of next year.
The industry is likely to welcome the parliament and council’s consensus on pushing back the implementation date to 2014, especially as a lot of the technical detail is still to be finalised. The more crucial piece for the industry now is how the areas of disagreement on some of the level two implementing measures are resolved. We are unlikely to get any clarity on this until autumn and the rules won’t be finalised until well into 2012.”