Governing body announces EU insurance rules delayed
The European Union has been struggling to solve the problems created by the ongoing financial crisis that has stricken the region. The governing body has turned to the global insurance industry for assistance, which has responded with providing the coverage needed to mitigate some of the aspects of the continuous crisis. Earlier this year, the EU introduced a new plan that would impose strict capital rules on insurers in some member countries as part of new regulations focused on the banking industry. It has been announced that the EU insurance rules have been delayed.
Division creates uncertainty regarding new insurance rules
Member states have been divided on the issue of banking regulations and how they may affect various economies. This division has created uncertainty in the EU as to whether the regulations will succeed in their aim of solving the problems created by the financial crisis. Because the banking industry is intimately tied with the insurance industry, rules have been drafted to address insurance concerns as well. These rules would institute new capital requirements for insurance companies in order to ensure any future financial disasters will not be as severe as the current one.
EU insurance rules receive opposition from insurance industry
The rules have received a great deal of opposition from the insurance industry. Some insurers argue that being held liable for the economic failures of some countries cannot be justified. Other claims that the capital requirements to be enacted by the EU are unreasonably high. Together with indecision from member states, these concerns have led to a delay in the institution of the EU insurance Erules, for now.
More information to be provided by European Commission in the coming months
Over the coming months, the European Commission, the legislative arm of the EU, will work to provide more clarity behind the EU insurance rules. The insurance industry is eager to learn more of the rules and have a say in how they might change in the future. The European Commission claims that it is not feasible to return to old rules due to the problems they would create with new regulations. There has not yet been any definitive decision regarding the EU insurance rules apart from putting the plan on hold.