Insurance Europe’s Reinsurance Advisory Board (RAB) has written to the US National Association of Insurance Commissioners (NAIC) to express concern about the NAIC’s draft implementation plans for the bilateral agreement on (re)insurance prudential measures that was concluded between the EU and US in 2017.
The agreement eliminates the requirement to post collateral placed on EU (re)insurers writing business in the US. However, the current draft NAIC proposals do not appropriately reflect the bilateral agreement. They foresee a more limited scope of application of zero collateral than in the agreement and give a significant amount of discretion to US state supervisors in areas that were stipulated in the agreement, such as all EU member states receiving all agreed benefits.
Equally importantly, European reinsurers call for an immediate start to the phased implementation of reduced collateral, in line with the agreement. The NAIC Reinsurance Task Force and individual states must take the necessary steps to ensure appropriate and swift implementation of the provisions of the bilateral agreement, respecting the timelines agreed between the EU and the US.
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