There is growing speculation that Solvency II will be delayed by up to two years, given the failure of the European Parliament and the Council of the European Union to reach agreement on the regime's treatment of products with long-term guarantees. Gabriel Bernardino, chairman of the European Insurance and Occupational Pension Authority (EIOPA), was reported to have said last week that a two-year delay could not be ruled out.
There are now fears that work to agree the fine details of the regime will drag into a new parliamentary term, which could cause the legislative to process to be thrown off course. The elections to the European Parliament are scheduled to take place in June 2014.
Earlier this month, the European Parliament's key vote on Omnibus II was postponed until March 2013, while EIOPA undertakes an assessment of the impact of Solvency II on long-term guarantee products. The negotiations between the parliament and the council to finalise the text of Omnibus II have been put on hold until after the impact assessment is completed. It is hoped that results of the assessment will enable the negotiations, which had stalled in recent months over the treatment of long-term guarantees, which will enable an agreement to be reached quickly.
Sharon Bowles MEP, chair of the European Parliament's economic and monetary affairs committee (ECON), agrees that the development of Solvency II needs to be complete during the European Parliament's current term. Bowles also accepts that a one or two-year delay in the implementation of Solvency II is likely.
Insurers are keen for the European authorities to confirm the implementation timetable so that national regulators can update their own timetables.
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