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The Actuary The magazine of the Institute & Faculty of Actuaries

European solvency regime for pensions?

In its most recent review, the Conference of European Insurance and Occupational Supervisors (CEIOPS) contrasted progress on Solvency II for insurers with virtually no progress on harmonisation of pension scheme supervision.

‘There are varying stages of convergence within and between insurance and occupational pension sectors. These are historic and dictated by national cultures and jurisdictions. There is considerable divergence across member states and their supervisory authorities’, CEIOPS said. ‘CEIOPS is addressing these differences related to past traditions and approaches’, it added. ‘The room for improvement is still significant from this perspective. However, it should be emphasised that, at this stage, challenges to achieving further convergence are also related to the low level of harmonisation of the EU regulatory framework.’

‘The Solvency II project takes up many of these challenges in the insurance sector, aiming at a harmonised EU prudential regime, including finding more streamlined arrangements for the supervision of multinational groups. Regarding the occupational pensions sector, obvious limits to supervisory convergence have related to the lack of harmonisation in the prudential regime, pending the actual implementation of the directive. In addition, significant differences between jurisdictions in the legal status and management of the institutions concerned present particular challenges. As already mentioned, CEIOPS is planning to monitor and compare relevant aspects of national transpositions. The results of this work could lead to further initiatives’, CEIOPS concluded.