The European Union may delay strict new capital rules for insurers amidst exerting pressure by Insurance firms, deteriorating economy of European countries and lack of general consensus for policy formulation.
The European Union commissioner responsible for regulation Michel Barnier was quoted by Reuters as saying that proposed delaying in the so-called Solvency II regime could be delayed by one year.
A spokesman for Barnier told Reuters, "That is something that we will have to clarify with parliament and council over the weeks to come. The commissioner put one scenario on the table because he thinks it’s a useful… avenue to unblock the negotiations."
He further said that predicting that the rule to be effective in 2013, 2014 or 2015 will be too early, as the agreement has been in a test phase which will be completed in March 2013.
After analyzing the effect of this new capital rule over the insurers, next course of action will be initiated.
The aim of the latest capital requirements law Solvency II for the insurers is meant to hold the necessary capital reserve pursuant to the risks they underwrite.