EIOPA Announces Measures to Address the Impact of COVID-19
Due to the outbreak of COVID-19, EIOPA is re-prioritizing and alleviating the burden by extending the deadlines or delaying projects where input from national competent authorities and/or industry is foreseen. EIOPA is extending the comments deadline of certain consultations, delaying publication of comments of some discussion notes or papers, and postponing the data requests planned in the first and second quarters of the year. Additionally, EIOPA has published a statement on dividend distribution and variable remuneration policies of insurers in the context of COVID-19.
As the capacity of financial institutions to respond to EIOPA consultation papers or calls for evidence is supposed to be affected by the current situation, it is proposed that the consultation period be extended in relation to the consultations that are open to the market. Details of the new consultation period end-dates and delays in publication of comments are as follows:
- Review of technical implementation means for the package on Solvency II Supervisory Reporting and Public Disclosure—Comments deadline is extended by six weeks from April 20, 2020 to June 01, 2020
- Consultation on Pan-European Personal Pension Product (PEPP) Implementing Technical Standards—Comments deadline is extended by four weeks from May 20, 2020 to June 17, 2020
- Consultation on discussion paper on ongoing changes to the new benchmark rates (or IBOR transitions)—Comments deadline is extended by nine weeks from April 30 to June 30, 2020
- Market and Credit Risk Comparative Study—Information request deadline is extended by five weeks from May 31, 2020 to July 03, 2020
- Discussion Note on value-chain/Insurtech—Publication for comments delayed to a date to be determined.
- Second discussion paper on methodological principles of insurance stress testing—Publication for public comments delayed to a date to be determined.
EIOPA also presented the list of data requests that have been postponed:
- It was planned in an event not to carry out, this year, the long-term guarantees measures (LTG) review information request to undertakings. The information request to the national competent authorities will likely be postponed from the second quarter to the third quarter of the year.
- With respect to the climate-risk sensitivity analysis 2020, data request to complete data available for top-down element and qualitative survey to large insurers as agreed in the roadmap for the 2020 exercise on climate-related transition risks will be cancelled. The report will be performed with the available information.
- Data collection for the work on the impact of ultra low yields on insurers to complement the Solvency II data planned for first/second quarter will be launched later to also incorporate COVID-19 reflections, if necessary.
In its statement on dividends distribution and variable remuneration policies, EIOPA urges (re)insurers to temporarily suspend all discretionary dividend distributions and share buybacks aimed at remunerating shareholders. This prudent approach should also be applicable to the variable remuneration policies. Insurers and reinsurers are expected to review their current remuneration policies, practices, and rewards to ensure that they reflect prudent capital planning and are consistent with, and reflective of, the current economic situation. This statement builds on the EIOPA statement from March 17, 2020, which stressed the importance of insurers preserving their capital position in balance with the protection of the insured, following prudent dividend and other distribution policies, including variable remuneration.
Related Links
- Press Release on Extending Consultation Deadlines
- Press Release on Dividend Distribution
- Statement on Dividend Distribution and Remuneration Policies
Keywords: Europe, EU, Insurance, COVID-19, Deadline Extension, Reporting, Reinsurance, Solvency II, Disclosures, Insurtech, Market Risk, Credit Risk, IBOR Transition, Climate Change Risk, EIOPA
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