04 July 2001

EP adopted Proposal on Solvency Margin Requirements Directive (1st reading)

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The parliament adopted both reports by Harald ETTL (PES, A) on life assurance undertakings and non-life assurance undertakings. The commission proposal was subject to a number of amendments many of which were of a technical or drafting nature. The parliament was also concerned to achieve a level playing field and avoid distortions of competition. It therefore adopted an amendment requiring the commission to indicate how frequently national supervisory authorities use discretionary powers and whether this results in major supervisory differences in the single market.
It also wanted to ensure that insurance undertakings in difficulty were not allowed to 'export' their problems by automatically being given a solvency certificate, thereby allowing them to trade in other member states. Another amendment took up the controversial issue of the calculation of the available solvency margin with reference to future profits. Parliament also wanted to insert a grandfather clause for existing mutual insurance undertakings falling below the new contribution limit to allow them to continue to fall within the scope of the directive.

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