Brexit to prompt new guidance for insurance regulators in Europe

The move to issue new guidelines has been prompted by concerns about regulatory arbitrage as insurers explore options to continue trading across the EU single market post-Brexit, according to a report by Reuters.

The news agency was reporting comments made by Manuela Zweimuller, head of policy at the European Insurance and Occupational Pensions Authority (EIOPA), at an insurance conference in Dublin last week.

EIOPA confirmed Zweimuller's comments to Out-Law.com and said that the new guidelines are likely to be issued in the coming weeks.

Zweimuller said: "EIOPA is closely monitoring the developments and will publish in due course its guidance for national authorities on sound principles for authorisation and supervision. We will subsequently closely monitor their implementation."

Separately, EIOPA has called on EU policy makers to update regulations to help support "supervisory convergence" in response to a European Commission consultation on the operations of European supervisory authorities in financial services.

"EIOPA’s regulation should be strengthened with a mandate to act more intrusively when it detects signals of risks of cross-border failures," EIOPA said (3-page / 75KB PDF) in its consultation response. "In addition, to reinforce EIOPA’s capacity to deliver fully on its mandate, it would be important to make clear reference in legislation to supervisory convergence tools that are already in development. This includes for instance the handbook of supervisory practices, the platforms on cross-border business, the EU-wide thematic reviews, and EIOPA’s staff assessment of national supervisory practices."

"EIOPA’s role with regards to supervisory independence and conflict of interests should also be strengthened. These fundamental supervisory principles have gained even more relevance under Solvency II, due to the degree of supervisory judgment necessary in the application of a risk-based regime," it said.