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Participants in the meeting organised by FFSA, France's insurance association, expressed hopes that negotiations at the European level will show progress in the near future, and that EIOPA, the insurance market regulatory body, will be able to launch a new round of assessment tests early in 2013.
But, no clear deadlines were announced by Gabriel Bernardino, Head of EIOPA, nor by officials from the European Commission and Parliament that attended the meeting. The lack of a clear timetable was criticised by insurance leaders such as Carlo Cimbri, the CEO of Italy's Unipol, who complained that uncertainties linked to the planned new rulebook affects the business planning of insurance companies and the design of new products.
Mr Bernardino said that the ball is currently in the politicians’ court. "We really need to have the commitment from the political side in order to implement Solvency II", he said.
The day-long conference in Paris was mostly dedicated to the issue of how insurers can keep funding the economy once the new capital and reporting rules are implemented. This has been a key topic of discussion on both life and non-life markets since the Directive first took shape. This has especially been the case in France where the lack of a market for private pension funds means that insurance companies have more weight in capital markets than in other European countries.
Insurance executives took the opportunity during last week’s event to reinforce their warnings that, if Solvency II imposes risk-weighting criteria that punish long-term investments, they will be forced to stop providing capital for the wider economy.
Addressing such complaints, Mr Bernardino warned that insurers can only make long-term investments if they have long-term liabilities to match. "We cannot just pretend that we can have long-term investments with short-term liabilities", he said. "And to apply the same kind of regimes to short-term and long-term liabilities is wrong. If we do that, we will create problems."
Mr Bernardino also warned that any final solution for the Solvency II negotiations must take into account the fact that the industry has in its books insurance products that were created and sold in the market based on very different economic and financial expectations.