ECON adopted report on reinsurance

26 April 2005

The Economic and Monetary Affairs Committee approved at first reading the report of Mr Skinner for regulating the reinsurance industry. The report welcomes the Commission's proposal to remove the use of collateral to secure reinsurance contracts, which is customary practice in certain member states such as France. One key issue the committee amended was the Commission proposal that solvency requirements for life reinsurance should be more stringent than for non-life reinsurance, on which the committee decided that the solvency margin rules should, in general, be the same.

ECON also voted to alter the rules under which insurance companies who also offer reinsurance services would be subject to the solvency rules applied to reinsurance companies. This would apply where the reinsurance premiums collected exceed 10% of their total premium, or where the reinsurance premiums collected exceed € 50,000,000, or where the technical provisions resulting from their reinsurance acceptances exceed 10% of their total technical provisions.

The measure is likely to be adopted at first reading stage

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