Solvency II and CMU: Thinking for the Long Term
With over 11 trillion Euros of assets under management, insurers are one of the largest institutional investors in Europe. They can play a fundamental role in financing the real economy and Europe’s recovery from the COVID-19.
Over the last years, the Solvency II framework has been amended to facilitate insurers’ investments in the real economy. Examples include preferential capital treatment to facilitate investments in infrastructures, high-quality securitisation or long-term equities. However, many insurers call for further changes to be made to the prudential rules (capital requirements for market risks and the risk margin), which still prevent long-term investments. On the other hand, EIOPA has noted that the new framework for investments in long-term equity has not necessarily been met by an increase in these investments.
In its report of June 2020, the CMU High Level Forum’s report suggests a deeper participation of insurers to the EU’s Capital Markets Union and proposes target modifications within the Solvency II revision to facilitate insurers’ investments in long-term investment and equity. In particular, the long-term nature of insurance business should be better reflected in the prudential framework. Improvements to capital calibrations and the risk margin should increase insurer’s capacity to invest in capital markets, particularly in equity.
The High Level Forum also suggested developing mechanisms that bring SMEs and midcap businesses requiring investment to the attention of insurers, as well as a revision of the IASB framework to ensure that insurers’ long-term investment horizons are better reflected.
This webinar will explore the role of the Solvency 2 prudential framework and the role of the insurance sector as long-term institutional investors in European capital markets. Closely aligned with the Commission’s Solvency 2 consultation and the planned Commission Action Plan on CMU, it will also discuss the necessary changes in the Solvency II framework, which may further incentivise long-term investments in the real economy.
Topics of Discussions will include:
- How can the Solvency II revision serve the political priorities of the EU in regards to the CMU and the Green Deal;
- Reconciling a risk-based framework with incentives to invest long-term;
- How to accompany greater investments in SMEs and equities;
- Insurers as investors to a carbon-neutral economy by 2050;
- Managing the low-for-long interest rate environment;
- The appropriateness of the accounting framework.
- Webinar link: https://zoom.us/j/97938596578
Speakers
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Didier MillerotHead of Unit Insurance and Pension, DG FISMADidier Millerot, born 1968, Franco-Belgian nationalities.
Didier Millerot joined the European Commission in 1994. He joined DG MARKT in 1997 where he held several legal positions.
He was appointed Deputy-Head of the Asset Management Unit in 1997 where he took active part in the negotiation of the UCITS IV and AIFM Directives.
After a year of secondment in the cabinet of Commissioner Barnier, Didier was appointed Head of the Accounting and Financial Reporting unit in 2012, a period during which the Accounting Directive was simplified and new transparency requirements introduced (non-financial reporting).
Didier then joined unit FISMA/D2 in 2015. During that period, new EU legislation on covered bonds was introduced. Didier also led the review of prudential requirements for investment firms.
Appointed Head of the Insurance and Pensions unit in 2019, Didier is now in charge of the Solvency II review. He also represents the European Commission at the EIOPA Board of Supervisors and in the IAIS ExCo. -
Fabio MarchettiGroup Head of International Affairs, GeneraliFabio Marchetti is currently Group Head of International Affairs in Generali since September 2019.
He previously was Senior Vice President for Eni and Head of Eni’s European Government Affairs Office in Brussels. He has held this position since 2008.
Prior to this, he started his career in JTI in the Brussels government affairs office and then moved to Unilever as European External Affairs Director for the Home and Personal Care category. He also briefly worked in the European Parliament and the United Nations.
Fabio holds a degree in political sciences from the “LUISS” University in Rome, with a final dissertation in International Relations. He then did an LL.M in the College of Europe in Bruges.
Fabio was born in Cape Town, South Africa in 1975. He extensively lived abroad in South Africa, Syria, Morocco, Malta, Mexico, France and Belgium. He is married and has two children.
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Fausto ParenteExecutive Director, EIOPAFausto Parente is the Executive Director of the European Insurance and Occupational Pensions Authority (EIOPA). In his role, he presides over the day-to-day management of EIOPA. Mr. Parente was first elected by the Board of Supervisors of EIOPA on 28 January 2016 and reappointed on 29 September 2020 for a five-year mandate. His nomination followed an open selection procedure and a public hearing at the European Parliament’s Committee on Economic and Monetary Affairs. On 9 March 2016 the European Parliament confirmed his appointment. Mr Parente has a distinguished career in supervisory regulations and policies at national and international level. Prior to his current role he was Head of the Supervisory Regulation and Policy Directorate at the Italian Insurance Supervisor, IVASS – Istituto di Vigilanza sulle Assicurazioni.
He was the Alternate Member in EIOPA Board of Supervisors and member of the Advisory Technical Committee of the European Systemic Risk Board (ESRB). In the context of the Italian Chairmanship in the EU Council (second half of 2014), Mr Parente chaired the Council’s working group on Insurance Mediation Directive negotiations. In 2011-2016 he chaired the Insurance Group Supervision Committee of EIOPA and in 2015-2016 – the Joint ESAs Committee on Financial Conglomerates. For several years he was an alternate member in the Technical and Financial Stability Committees of the International Association of Insurance Supervisors (IAIS).
Mr Parente has a degree in Economics from the University Federico II, Naples, and he is licensed to practice as a certified accountant and financial analyst. He has attended many post-graduate courses in the fields of management, European Community law, economy and finance of insurance undertakings. He is author of a series of publications on insurance supervision. -
Tobias BüchelerHead of Regulatory Affairs, AllianzTobias Bücheler is Head of Regulatory Affairs of Allianz Group. He is responsible for Allianz’ regulatory strategy, related thought leadership and outreach activities on key topics like Solvency II, Digitalisation, Conduct and Sustainability. Furthermore he is in charge of the day-to-day interaction with supervisors and standard setters for Allianz Group. Tobias Bücheler joined Allianz in 2000 and has held several senior management positions in finance, investment and risk since then, including roles as Solvency II Program Leader for Allianz Group, Chief Investment Officer at Allianz Australia and Risk Coverage Officer for the Asset Management & Banking division. Before joining Allianz he was associated with JP Morgan Asset Management. He holds a degree in economics and finance from the University of St. Gallen.