EIOPA believes that a consistent and disciplined communication of individual stress test results would enhance market discipline, increase participants’ commitment and contribute to a level playing field among insurers and across the financial sector, resulting in a healthier insurance industry.
The European Insurance and Occupational Pensions Authority (EIOPA)
has published today an Opinion on the disclosure of individual results
in the context of insurance stress tests.
EIOPA conducts Union-wide stress test exercises to assess the
resilience of the European insurance industry and has until now
communicated the results based on aggregated data. Over the past years,
EIOPA has sought to further improve the transparency of the exercise
through the publication of individual results and engaged with
stakeholders on the matter.
EIOPA believes that a consistent and disciplined communication of
individual stress test results would enhance market discipline, increase
participants’ commitment and contribute to a level playing field among
insurers and across the financial sector, resulting in a healthier
insurance industry as a whole.
Despite the steps taken by EIOPA to address the industry’s concerns
regarding individual disclosures, such as by requesting only a subset of
balance sheet indicators to be published, the majority of (re)insurers
continue to show reluctance.
EIOPA therefore considers that a change in the legal framework
allowing EIOPA to disclose the results of individual undertakings is the
only way to obtain the disclosure of individual information.
The ongoing review of Solvency II with a targeted amendment of
Solvency II Directive (2009/138/EC) would provide a straightforward
solution.
Petra Hielkema, Chair of EIOPA, said: “Our
experience over the past years has shown that without making it a legal
requirement, individual disclosures would in all likelihood remain the
exception rather than the standard for the sector. We have now taken the
initiative to ensure that (re)insurers adhere to similar levels of
transparency as other parts of the financial system. The insurance
industry and its regulatory framework are robust enough and ready for
this change.”
Background
The Opinion is addressed to the European Commission, European Parliament and the Council of the EU.
EIOPA
© EIOPA
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