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11 May 2012

Reuters: UK's Cameron backs insurers on EU capital rules


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British Prime Minister, David Cameron, said on Friday that his government would fight to make sure Europe's proposed Solvency II capital rules for the insurance industry did not put insurers in Britain at a disadvantage.


"I do understand the dangers in Europe of Solvency II if we don't get that right", he said at an event in the Lloyd's of London insurance market. "We will listen to that and make sure the regulation is right."

The British insurance industry has complained about the cost of complying with the new regime, with life insurers expressing particular concern over the capital charge it could impose on long-term products such as annuities.

Cameron was speaking as Lloyd's outlined a strategy to become the world's leading insurance hub by 2025 by cashing in on growing demand for insurance in emerging markets such as China and Brazil.

Lloyd's chairman John Nelson added that British regulators had agreed to ease scrutiny of the 324-year old insurance market that had become "completely overwhelming". "We have in the last six months had serious conversations with the government, the Bank of England and the Financial Services Authority, and I'm pleased to say that in the last few weeks they have acknowledged that they need to recalibrate", he told reporters.

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© Reuters


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