UK lobby must tackle Solvency II “sticking points”

Controversial proposals for group supervision under Solvency II should not be watered down under pressure from the more conservative member states, says an influential report from the House of Lords European Union Committee. Plans for group supervision, which would hand primary responsibility for group supervision to the regulator of the parent company’s home state and involve regulators in other member states to supervise local subsidiaries, have emerged as one of the key “sticking points” and the centre of complaints from several of the smaller member states since the publication of the draft framework directive for Solvency II in July. While the UK is strongly backing the proposals, others, in particular Slovenia which currently holds the EU presidency, are concerned that they will have less control over insurers operating in their countries.