Insurance giants Aegon, Aviva and Munich Re have all welcomed the new European Union directive on insurance and reinsurance supervision, otherwise known as Solvency II, which was proposed by the European Commission.

The EU initiative seeks to fundamentally restructure national supervisory systems for the European insurance industry, driving them more closely to strictly economic, risk-based criteria.

Dutch insurance and pensions specialist Aegon believes that the proposed directive would lead to the creation of one of the most advanced and effective solvency and supervisory systems in the world, strengthening the European insurance industry and enhancing its overall competitiveness.

Philip Scott, who will become group finance director of UK general insurer Aviva on July 12, 2007, added: Aviva is – and has always been – fully committed to contributing to the success of Solvency II, and now calls on the European Parliament and the Council of Ministers to ensure its smooth and swift adoption. Beyond the EU, we also hope that Solvency II will be seen as a model for global supervision.

Although German insurance provider Munich Re has also welcomed the new directive, the group’s CFO, Jorg Schneider, criticized some individual details of the proposal and suggested that the final directive ought to take greater account of the balancing effects of different types of risk and to structure group supervision even more effectively.