Gabriel Bernardino, Chairman of EIOPA, delivered a statement on the achievements of EIOPA over the past year, along with the challenges ahead, at the hearing of the European Parliament’s Economic and Monetary Affairs Committee. He focused on topics such as enhancing supervisory convergence, reinforcing better consumer protection, and maintaining financial stability. He also discussed the future trends, challenges, and opportunities and the way EIOPA will address these. EIOPA also published a document describing the main achievements during October 2016 to September 2017.
The EIOPA Chairman noted that the development of a more coordinated supervision is essential to avoid regulatory arbitrage. EIOPA reinforced supervisory cooperation for cross-border business, involving information and data exchange facilitated by the setup of cross-border supervisory platforms coordinated by EIOPA. He also mentioned that delegated regulations under the Insurance Distribution Directive (IDD) are a significant milestone in further promoting a consistent approach toward consumer protection across Europe. The first EU-wide in-depth analysis of consumer protection issues in the unit-linked market was published with the thematic review of EIOPA on monetary incentives and remuneration between providers of asset management services and insurance undertakings. Additionally, public consultation about statistical reporting requirements for pension funds was launched to further strengthen the insight in the pensions market. With regard to the Pan-European Personal Pension product (PEPP), he stated, “We believe that our role in its implementation will be essential to ensure its quality and effective supervision. The PEPP also has the potential to create a true single market for personal pensions that can only benefit European citizens.”
With regard to financial stability, he said that the European stress tests are an essential tool. "We have also seen the impact of Solvency II data reflected in our improved analytical framework used for financial stability analysis and assessments, notably in our Financial Stability Reports and Risk Dashboard, " said Mr. Bernardino. "Furthermore, given the substantial differences in funding, scope, and coverage of existing Insurance Guarantee Schemes (IGS) across the EU, EIOPA will explore the possible set-up of a minimum harmonized framework for such schemes at the EU level." said Mr. Bernardino. EIOPA’s stronger mandate to ensure convergence in supervisory practices through the development of Strategic Supervisory Plans and the empowerment to undertake independent assessments of Internal models are steps in the right direction. EIOPA’s role on supervisory independence and conflict of interests should be strengthened, along with strengthening of EIOPA's Regulation, with a mandate to act more intrusively when it detects signals of risks of cross-border failures. Furthermore, the national supervisory authorities should be obliged to notify EIOPA early enough in case companies experience deteriorating financial conditions with possible cross-border effects. In conclusion, he expressed his confidence, "that the European Parliament will use the current review of the EIOPA Regulation to ensure proper independence and accountability of supervisors and reinforce the quality and consistency of insurance and pensions supervision in the European Union with tangible benefits to businesses, economies and, of course, citizens."
Keywords: Europe, EU, Insurance, Securities, Solvency II, IDD, Financial Stability, PEPP, Stress Testing, EIOPA
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