A key vote which is needed for the new rules governing Europes insurance industry, Solvency II, to be finalised has been delayed again.
The European Parliament had been due to vote on the Omnibus 2 Directive which underpins Solvency II on June 10, but it emerged today that this vote has now been put back until October 22.
The Parliament is yet to confirm the reasons for the latest delay, but it is expected to allow for full consideration of the results of a study being undertaken to consider the impact the new rules will have on insurance products offering long-term guarantees, and to draft any resulting amendments to the legislation.
This study was launched last month by the European Insurance and Occupational Pensions Authority, with the conclusions expected in the second half of June. The European Commission is then due to draft its own report by July 12.
Consultancy KPMG said that while the schedule meant a delay in the plenary vote was 'inevitable', it was 'disappointing' that European legislators had still not provided a clear timetable for the remaining steps that were needed to for Solvency II to be introduced. The head of EIOPA has told The Actuary that the rules, which had been due to be implemented in January 2014, were now unlikely to come into force until January 2016 at the earliest.
Peter Ott, European head of Solvency II at KPMG, said: 'European insurers are ostensibly fatigued by the many delays that have happened throughout the last decade and the discussions whether the directive will ever become a reality in its current form are becoming more intense. A clear timetable is needed on the remaining steps to industry compliance.'
KPMG is now working on the assumption that the rules will have to be implemented by insurers from January 1 2016, explained Janine Hawes, insurance director at the consultancy.
But she added that it was 'critical' for insurers to know what EIOPA was proposing for the interim period. The regulator first mooted interim implementation of aspects of the new system relating to governance, risk management and transparency in November, and is now due to publish guidance on the procedures national supervisors should put in place this spring.
'The focus is heavily on the pillar 2 requirements of Solvency II such as governance, risk management and ORSA principles, so insurers should continue to further develop and stabilise these areas throughout this year,' Hawes said.