The Solvency II regime, which has been in the works for more than a decade, now looks unlikely to be implemented fully before 2016 after industry lobbying and wrangling between Member States caused further hold-ups last year.
In particular, insurers in some markets are worried about the prospect of life products that guarantee returns to policyholders carrying more onerous capital charges. Analysts say Solvency II threatens to undermine the business model of life insurers in Germany, where guaranteed products are particularly prevalent.
In the face of these concerns, the European Insurance and Occupational Pensions Authority, will next week begin a study into how long-term guarantees will be treated under the new regulations. It has a wide remit, considering the impact on policyholders as well as the financing of infrastructure and enterprise.
In the meantime, several national regulators are pressing ahead with their own reforms. The ongoing delays have led some executives to wonder publicly if the project will ever be launched as envisaged.
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