You have to hand it to them – they were the first to teach us about the nature of electricity, the first to invent a reliable telephone network, they were even the first to land on the moon! Therefore, it shouldn’t have come as much of a surprise whenever the Americans announced that their Solvency II regime for insurers is expected to achieve equivalence with the E.U’s Solvency II requirements – and possibly even before their European counterparts!
This can only spell positive and rather “less risky” prospects for the future relations between these two actuarial industries, with Fitch ratings predicting that the US’s regime will receive equivalence recognition from the E.U – with this equivalence being mutually beneficial.
Among those who will benefit most from the new regimes are; European companies that have large subsidiaries regulated in the US, US companies selling reinsurance to EU companies and US groups with subsidiaries in Europe.
Of course though, with every winner there must be a looser – likely to come in the form of a local competitor of EU owned subsidiaries that would otherwise have benefitted from reduced competition and possible acquisitions as well as reinsurers that may have picked up extra business.
It’s great to see the US and European giants working together for greater cohesion within the actuarial field, particularly in relation to risk assessment and reinsurance issues. There is widespread hope that such co-operation will lead to further agreement on equivalence.
Contractuary.com is very much in favour of these comradely moves, as it makes way for more universal understanding within the industry. Onwards and upwards from here we say!