Deadline could be pushed back again as European Commission, European parliament and the Council of the European Union failed to agree on the final version
The EU will struggle to enforce Solvency II implementation on insurers by the deadline of 1 January 2014, an expert who helped draft the new directive has warned.
Promontory Financial Group director Alberto Corinti said the deadline could be pushed back as much as a year after the European Commission, European parliament and the Council of the European Union failed to agree on the final version of the new capital requirements when they met this month.
Corinti said that the hold-up was caused by the current European economy, with a widening of spreads on corporate and sovereign bonds, and low interest rates making implementation tough.
“It is likely that 1 January 2014 won’t be met because it was really ambitious before, but now with this delay in achieving implementation it will be difficult,” he said. “The delays could now be six months to one year.”
But Corinti, who helped put together Solvency II in his role as deputy director-general and director of economics and finance of the European Insurance and Reinsurance Federation, told Insurance Times that the UK was better prepared than other countries for the new directive.
“The UK is quite advanced in terms of preparation for Solvency II because of its background with ICAAP [Internal Capital Adequacy Assessment Process],” he said. “There is not the same level of preparation in other countries.”