Friday, 15 February 2019


AMICE:Joint statement signed in Brussels on the effects of regulatory requirements and compliance on employees

The Association of Mutual Insurers and Insurance Cooperatives in Europe (AMICE), the voice of the mutual and cooperative insurance sector in Europe, together with the Insurance Sectoral Social Dialogue Committee (ISSDC), has today signed a statement on the effects of regulatory requirements and compliance on employees, and announced a follow-up to the joint declaration on the social effects of digitalisation.
The legislative reform of the insurance sector over the last decade is well documented. Ten years on, the pressure of reform is affecting people working in the financial services sector, as operators, customers and financial sector employees are witnessing the effects of increasingly burdensome, heavy-handed and duplicative legislative reforms.
For customers, the disclosure of extensive and technical information impedes straightforward decision making, creates confusion and makes the decision-making process unnecessarily difficult and stressful.
For employees, legislative reform has affected their wellbeing. In particular, the European social partners in the insurance sector noted that the significant increase in regulatory requirements has led to a substantial rise in insurance employees’ workloads and stress levels, and today they call for employees to be given enough time to assimilate the latest changes in legislation and sufficient time to apply them.
Implementing new regulatory requirements involves the development and adoption of complex company compliance procedures, which need to be accompanied by proper training. The social partners declare in their statement that they are concerned about short implementation deadlines which leave too little time to properly implement complex and comprehensive pieces of legislation and for employees to have appropriate training.
The social partners further note that the negative effects have a disproportionate impact on small and medium-sized entities, which contribute significantly to local economies but face a heavy burden keeping up with constant regulatory changes.
Sarah Goddard, AMICE Secretary General commented,
She continued,
“The pressure on people working in the financial services industry on understanding and implementing such wide-ranging and complicated regulatory requirements has taken a significant toll. It is important to remember that insurance is ultimately a people business, and that we have a responsibility to ensure that all employees are protected from undue stress.”
In addition to the statement on the effects of regulatory requirements and compliance on employees, the Insurance Sectoral Social Dialogue Committee (ISSDC) has issued a follow-up to build on the declaration on the social effects of digitalisation signed in October 2016. This follow-up looks to respond to the recent and increasingly rapid development of digitalisation. It seeks to frame further common measures across all participating organisations and their members to ensure long-term employability of the mutual and cooperative insurance workforce.
§  Further training as a key
§  Time and place of work
§  Dealing in a social way with the digital structural change
§  Employees’ representatives in the digital age

The declaration aims to safeguard jobs and the employability of employees; improve the work-life balance of employees; encourage the adoption of all appropriate digital communication channels; and underline the need for continuous training to be provided by insurance companies and the importance of employees’ willingness to undertake such training.
The full documents are available from the AMICE Secretariat or via the AMICE website.

To continue building on the work already achieved, the European social partners in insurance will monitor the development of employment in the sector on a yearly basis, taking due account of existing statistics.

EIOPA welcomes agreement on a Pan-European Personal Pension Product

The European Insurance and Occupational Pensions Authority (EIOPA) welcomes the agreement reached by the European Parliament and the Members States on the proposal for a Pan-European Personal Pension Product, the PEPP.
Gabriel Bernardino, Chairman of EIOPA, said:  "Today's agreement is a key milestone in providing sustainable pensions and addressing the ever growing pensions gap in Europe. The PEPP should be available to every citizen in the European Union. Within a transparent and cost-effective framework, it will offer greater choice to save for retirement making a real difference in citizens' lives. At the same time, strong protection of consumers is crucial. Therefore, EIOPA, together with the national competent authorities, will ensure effective supervision through the consistent application of a unified supervisory methodology to safeguard the trust and confidence of European citizens in the PEPP label."

Monday, 11 February 2019


Updated tool highlights insurers’ consumer-focused practices across EU

Insurance Europe has published an update to its online consumer focus tool, which outlines examples of the work undertaken by Europe’s insurers to provide innovative products and services for consumers.

The tool, which is available here, provides information through an interactive map of Europe that allows users to click on specific countries to gain insight into insurers’ consumer-focused practices in that particular market.
The tool provides examples of initiatives in several important areas, including:
  • Innovative products and services
  • Digitalisation
  • Enhanced claims management
  • Transparency and financial education
  • Initiatives to fight insurance fraud
The initiatives were developed with specific national features in mind, such as national regulatory frameworks and local consumers’ needs, which — like insurance companies — can differ significantly between EU countries. Insurance products and services are, therefore, not directly transferable from one market to another.

Friday, 8 February 2019


ESAs publish recommendations on changes to the PRIIPs Key Information Document

The European Supervisory Authorities (ESAs) today published their final recommendations following a consultation on targeted amendments to the Delegated Regulation covering the rules for the Key Information Document (KID) for Packaged Retail and Insurance-based Investment Products (PRIIPs).
Having taken into account the feedback received and considering in particular the implications of a possible decision by the European Co-legislators to defer the application of the KID by certain types of investment funds beyond 2020, the ESAs decided the following:
  • To not propose targeted amendments at this stage
  • To initiate a more comprehensive revision of the PRIIPs Delegated Regulation to be undertaken in the course of 2019, including to launch a consultation on the draft Regulatory Technical Standards
Furthermore, the ESAs issued a Supervisory Statement regarding the performance scenarios to promote consistent approaches and improve the protection of retail investors prior to the conclusion of the review. The ESAs consider that there is a risk that retail investors are provided with inappropriate expectations about the possible returns they may receive. Therefore, the ESAs recommend PRIIP manufacturers to include a warning in the KID to ensure that retail investors are fully aware of the limitations of the figures provided in the performance scenarios.

The Key Information Document (KID) for Packaged Retail and Insurance-based Investment Products (PRIIPs) is a mandatory, three-page A4 information document to be provided to consumers before purchasing a PRIIP. PRIIPs include for example funds, structured products, unit-linked and with-profits life insurance contracts, and structured deposits.
On 1 October 2018, the ESAs wrote a letter to the European Commission expressing their concerns regarding the possibility of duplicating information requirements for investment funds from 1 January 2020 and the importance of legislative changes to avoid such a situation, including a targeted review of the PRIIPs Delegated Regulation.
Subsequently, on 8 November 2018 the ESAs published a consultation paper proposing targeted amendments that would allow the KID to be applied to all types of investment funds and to address key issues that have arisen since the implementation of the KID, in particular concerning the performance scenarios.
In parallel with the ESAs' work, the European co-legislators also initiated discussions on legislative changes relating to the application of the KID by certain investment funds and the timing of a review of PRIIPs.  When publishing the consultation paper, ESAs stated that they would take into account the latest information regarding these political discussions when deciding upon their final proposals.
The Supervisory Statement is issued under Article 29(2) of the ESAs' Regulations as a convergence tool to promote common supervisory approaches and practices.
The PRIIPs Regulation (No 1286/2014) defines the main rules and principles for KIDs. It is supplemented by a Delegated Regulation (2017/653) specifying the presentation and contents of the KID, which is based on Regulatory Technical Standards that the ESAs were mandated to develop.
Performance scenarios are included in the Section of the KID titled "What are the risks and what could I get in return?" They indicate how the investment could perform under various different scenarios.

Thursday, 31 January 2019


11th International Conference, 23 May 2019, Bucharest, Romania

The world is changing and insurance is changing too.

How can we protect sustainable societies? Make insurance regulation fit for the future? Cope with changing natural catastrophes? Tackle complex cyber risks?
Debate these issues and more at Insurance Europe’s 11th International Insurance Conference, on 23rd May at the JW Marriott Bucharest Grand Hotel, Romania.

Speakers include:
  • Oliver Bäte, chairman, Allianz SE, Germany
  • Gabriel Bernardino, chairman, EIOPA
  • Andy Bord, CEO, Flood Re, UK
  • Andreas Brandstetter, president, Insurance Europe and chairman & CEO, UNIQA Insurance Group, Austria
  • Frédéric de Courtois, general manager, Generali Group, Italy
  • Lard Friese, chairman & CEO, NN Group, Netherlands
  • Victoria Saporta, chairwoman, IAIS
  • Elisabeth Stadler, chairwoman & CEO, Vienna Insurance Group, Austria
  • Paweł Surówka, chairman & CEO, PZU Group, Poland

Tuesday, 29 January 2019


Insurers warn that IAIS systemic risk proposals lack clarity

The International Association of Insurance Supervisors’ (IAIS) proposal for a new holistic framework for identifying and managing systemic risk in the insurance sector currently lacks sufficient clarity.
Insurance Europe is therefore calling on the IAIS to improve its proposal, most notably by:
  • Stipulating that — before supervisory intervention is required — national supervisors must work with insurers to achieve a mutual understanding of situations that might give rise to systemic risk and discuss alternatives to intervention.
  • Better distinguishing between measures that are reflective of good practice and that should be applied proportionally and more drastic measures (such as resolution) that should only be applied where it can be demonstrated that there are material risks to the global financial system.
  • Defining a well-calibrated threshold to identify systemically risky activities that could — if undertook by several insurers — amplify shocks to the rest of the financial system.
Insurance Europe added that any new policy measures linked to systemic risk must be globally-consistent and applied in a proportionate manner. The holistic framework should also pay particular attention to preserving a level playing field between different insurance groups and jurisdictions.
Moreover, Insurance Europe has always argued that traditional insurance is not systemically risky, and that systemic risk can only originate from a very limited number of activities undertaken on a large scale in the wrong conditions. Therefore, a strong application of the proportionality and materiality principles should guarantee that insurers are not subjected to undue regulatory burdens, given the limited systemic risk posed by their traditional business models.
Insurance Europe’s full response to the IAIS’ consultation on the holistic framework is available here.

Monday, 28 January 2019


EIOPA calls for improvements to the assessment of the propriety of board members and qualifying shareholders of insurance companies

  • The peer review examines how national competent authorities (NCAs) assess the propriety of those responsible for managing insurance companies and, when relevant, the companies' shareholders
  • In general, NCAs dedicate considerable resources to the initial assessment, but very few NCAs perform any ongoing assessments as part of their supervisory activities
  • Diverging assessment practices continue to exist among NCAs, which can lead to different outcomes in different countries for the same individual
  • The review resulted in 80 recommended actions for 29 NCAs
the European Insurance and Occupational Pensions Authority (EIOPA) published the findings of its peer review examining how national competent authorities (NCAs) assess the propriety of administrative, management or supervisory body (AMSB) members and qualifying shareholders.
EIOPA reviewed national regulatory frameworks and supervisory practices followed by NCAs to assess the propriety of AMSB members and qualifying shareholders at solo and group level, both at the moment of authorisation and on an ongoing basis. Furthermore, EIOPA assessed the effectiveness of cross-border cooperation.
A key requirement of Solvency II is for insurers to be owned and run by persons of integrity. The primary responsibility to ensure the fitness and propriety of AMSB members at all times rests with insurers, with NCAs carrying out their assessment following the assessment by insurers. Similarly, any acquisition of or changes to qualifying shareholders are subject to review and approval by NCAs. 
This report presents the overall findings of the peer review, including identified best practices, case studies and recommended actions. The findings are published on a named basis.
In general, NCAs invest considerable resources in the initial assessment of AMSB members and qualifying shareholders. However, these tend to be seen as a one-off task with few NCAs undertaking any ongoing assessments as part of their supervisory activities. Ongoing assessment should involve proactive, risk-based and proportionate engagement resulting from the NCAs' own initiative, as part of its supervisory activities.
Other areas requiring action from NCAs were related to the national legislation or regulatory framework; propriety assessment questionnaires; as well as guidance and supervisory records.
The review was initiated following a number of cross-border cases indicating a lack of harmonisation in relation to the propriety assessment across the European Economic Area, leading to potentially divergent outcomes in different countries in relation to the same person. The review found that complex cross-border cases of propriety assessment can take a long time, hampered by cumbersome information sharing processes. In relation to the definition of propriety of ASMB members, a significant variation with respect to whether and when to consider ongoing prosecution and pending investigations for criminal and administrative offences became apparent. As a result of this peer review, EIOPA will seek to strengthen and support processes of cross-border assessments.
A shorter Executive Summarythe full report and the methodology applied in the conduct of the peer review can be obtained via EIOPA's Website.
Gabriel Bernardino, Chairman of EIOPA, said: "Behaviour steers business. Character influences governance. Conduct dictates the integrity of financial health and reporting of business. Behaviour, character and conduct often contribute to the likelihood of failure and unfair treatment of consumers. Therefore, propriety is an essential element of the governance and supervision framework of Solvency II. This peer review highlights differences in national legal and regulatory frameworks as well as in supervisory processes in relation to propriety assessments. In addition to improvements that NCAs are already implementing, EIOPA will further strengthen convergence of practices by supporting the process for information gathering and, where necessary, sharing, processes related to complex cross-border cases as well as identify possible ways to strengthen the legal powers of NCAs. In this way, we can protect both the integrity of the internal market and consumers across Europe."

Wednesday, 23 January 2019


Big data and its big benefits for consumers

Insurance Europe has today published an insight briefing about how insurers’ use of big data can benefit consumers.  
The briefing provides various examples of these benefits: for example, it explains how pay as you drive motor insurance policies enable insurers to tailor insurance premiums, resulting in savings for good drivers.
The briefing says that, while there is no specific regulation on big data, there are already several EU rules that are relevant and applicable to its use in insurance, such as rules on privacy, insurance distribution, disclosures, distance marketing and equal treatment. As such, there is currently no need for further regulatory measures, as there is already a comprehensive set of rules ensuring the responsible use of big data in insurance.
In fact, the briefing warns that premature regulation could not only hamper innovation and impair the effectiveness of the insurance market, but also quickly become unfit for purpose due to technological advances and market developments.
Regulators and supervisors should instead ensure that existing rules — which already provide a framework to guarantee the responsible use of big data — are fully implemented and enforced at national level.
Insurance Europe also published a Q&A on insurers’ use of big data, which is available here.

Tuesday, 22 January 2019


Insurers provide feedback to OECD on cyber issues

The Global Federation of Insurance Associations (GFIA) has provided feedback to the Organisation for Economic Cooperation and Development (OECD) on its next steps on cyber issues.
GFIA said the cyber insurance market is a key resiliency tool, which continues to grow as insurers innovate to address consumer needs and market demands.
GFIA highlighted that there are challenges to market growth, which the industry continually monitors and works to overcome. Among these challenges are educational and awareness gaps, a risk landscape that is continually evolving and a need for more data.
GFIA suggested a number of questions for the OECD to consider when reviewing the broader cybersecurity landscape to ensure policy and regulation support an open market.
GFIA’s full submission is available here.

Saturday, 19 January 2019


Zurich:The Global Risks Report 2019

The 14th edition of the Global Risks Report identifies and discusses the many challenges and key risks presented in the year ahead.

Weakened International Cooperation Damaging Collective Will to Tackle Global Risks

  • Is the world sleepwalking into a crisis? Global risks are intensifying but the collective will to tackle them appears to be lacking. Instead, divisions are hardening. The world’s move into a new phase of strongly state-centred politics, noted in last year’s Global Risks Report, continued

  • Rising geopolitical and geo-economic tensions are the most urgent risk in 2019, with 90% of experts saying they expect further economic confrontation between major powers in 2019

  • Environmental degradation is the long-term risk that defines our age, with four of the top five most impactful global risks in 2019 related to climate

  • Rapidly evolving cyber and technological threats are the most significant potential blind spots; we still do not fully appreciate the vulnerability of networked societies

  • The importance of the geopolitical and geo-economic changes that are under way should not distract us from the human side of global risks. For many people, this is an increasingly anxious, unhappy and lonely world, with rising anger and empathy declining

  • In today’s complex and tightly coupled systems the importance of building resilience and doing a much better job of learning lessons from the small failures before they become catastrophic is vital
Download the full Report and Executive Summary here: