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The availability of a wide range of investment assets is key to meet insurers’ investment needs. The investEU programme has the potential to address the investment gap in the EU and to stimulate additional long-term viable assets that insurers can invest in.
It is key that public support is provided only when actually needed, and intervention by national/multilateral development banks should not create the unintended effect of crowding out private investment.
At the same time, it is equally important for the prudential rules defined in Solvency II, which play a key role in investment decision making, to correctly reflect the risks and economics of the business. Action is needed now to remove unnecessary barriers to long-term investments and ensure the natural and significant role of the insurance industry in the investEU initiative.
Important first steps can be taken in the Solvency II 2018 review and completed in the wider 2020 review.