02 July 2009

CEIOPS approves recommendations on Insurance Guarantee Schemes

CEIOPS members approved their recommendations on the Insurance Guarantee Schemes. Where no agreement or clear majority could be reached CEIOPS describes the pro and cons of alternative options.

• A minimum harmonisation approach should be adopted to fill in the gaps of the current European coverage.
• The preferred option is for a guarantee scheme of last resort set up by individual Member States for life and non life insurance, leaving some flexibility to choose among a number of techniques to find the best possible solution in each individual case.
• The intervention of an IGS should be triggered according to the same conditions as for the Deposit Guarantee Schemes.
• IGS covers all classes of life insurance and non-life insurance.
• Claimants should include, at the minimum, all natural persons be it policyholders and other beneficiaries covered by the insurance contract.
• Member States are allowed to extend the scope of coverage to other claimants.
• The basic starting premise is that the value of claims is to be determined on a contractual and legal basis.
• CEIOPS acknowledges the different importance of unearned premium in life vs. non-life insurance.
• Insurance which is compulsory at EU level should not be subject to co-payments
• CEIOPS expresses a preference for the home state principle so that companies are covered by the IGS in the state where the company is authorized.
• The organisation of national insurance guarantee schemes is left to the individual member states.
• CEIOPS recommends that IGS should be required to make payments as soon as practicable after the claim has been assessed.
• If the EU were to introduce a European regime for insurance guarantee schemes, this should not be extended to the occupational pensions sector.

© CEIOPS