BRUSSELS, Sept 19 |
BRUSSELS, Sept 19 (Reuters) - The European Union could postpone strict new capital rules for insurers because of wrangling between member countries over the final shape of the new regulations.
Michel Barnier, the European Union commisioner in charge of regulation, suggested delaying the so-called Solvency II regime by one year, a source involved in negotiations over the rules told Reuters on Tuesday.
A spokesman for the commissioner said that he had called for an impact assessment of the rules by March 2013, but that it was to early to say whether the January 2014 start date would have to be put back.
"That is something that we will have to clarify with parliament and council over the weeks to come. The commissioner put one scenario on the table because he thinks it's a useful ... avenue to unblock the negotations," he said at a press conference on Wednesday.
A delay would prolong uncertainty over the industry's future capital requirements, though leading European insurers said it would be better to postpone the new rules than push through measures that might then have to be amended.
"If this news report is confirmed, the additional year would certainly give all of those involved the time to carefully work through a range of important open questions," Immo Querner, finance chief of German insurer Talanx, told Reuters.
"A delay for a short period of time is better than rushing through something that would require a lengthy correction."
Solvency II, ten years in the making and designed to force insurers to hold capital reserves in strict proportion to the risks they underwrite, has been held up by disagreements over how the cash buffer for long-term life insurance contracts should be calculated.
European governments, keen to avoid onerous requirements that could make pensions more expensive, favour different calculation methods depending on their respective industries' business models, leading to deadlock in talks over the final draft of Solvency II.
"We welcome the postponement as it allows (us) to resolve still open questions and sufficiently test the effects of any Solvency II rules prior to finalising the directive," Allianz , Europe's biggest insurer, said in a statement. "Sound principles and clarity must prevail over readiness."
Postponing Solvency II would be politically embarrassing for the Commission, which had intended the rules to serve as a global benchmark for other countries.
Insurance Europe, the pan-European insurance industry lobby, declined to comment, as did the Association of British Insurers, which represents Europe's biggest insurance market.
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