“Thriving in Challenging Times” - Central Bank Insurance Conference

• Insurance conference explores challenges facing the insurance industry
• Introduction of proposed judicial guidelines on personal injury claims would bring stability to the cost of insurance
• Solvency II review in 2020 to ensure continued protection of policyholders and beneficiaries

The Central Bank hosted a conference for the insurance industry today with the theme “Thriving in Challenging Times”. The conference brought together domestic and international thought-leaders and policy makers to discuss issues facing the insurance industry.

Opening the conference Deputy Governor Ed Sibley said: “I expect the boards and management of regulated firms to ensure that their firms are sufficiently resilient. I also recognise and support system wide efforts to address some of the factors causing volatility and higher insurance costs than in other comparable countries. These efforts include the work of the Cost of Insurance Working Group. An associated recommendation of the Personal Injuries Commission, chaired by Nicholas Kearns, is for the establishment of judicial guidelines for appropriate general damages for various types of personal injury. Such guidelines should lead to greater levels of consistency in the assessment of general damages in Ireland, which should help in better enabling the domestic non-life insurance sector to support its customers.”

Mr Sibley spoke about the upcoming review of the Solvency II: “We can, and must continue to develop the Solvency II regime, to ensure it remains relevant and appropriately protects policyholders and beneficiaries. Solvency II will be reviewed in 2020. This review will provide the opportunity to examine the practical implementation of Solvency II, ensure it remains fit for purpose, adapts to changes in market conditions and evolving business models, while continuing to meet its fundamental objectives.”

On Brexit the Deputy Governor said: “We are only in the foothills of the potential testing of the resilience of the financial system that a hard Brexit will cause.” He added, “the majority of firms covering the vast majority of [insurance] policies written are taking appropriate action. However, there are some remaining risks of consumer detriment.” This includes, for example, the supply of niche insurance products may reduce or end altogether, given the increased costs and frictions of serving EU customers from the UK.

Also speaking at the conference Gabriel Bernardino, Chairman of the European Insurance and Occupational Pensions Authority (EIOPA) spoke about the challenges and opportunities for the insurance industry from an European perspective. Professor Karel Van Hulle, Associate Professor at the Economics and Business Faculty of the KU Leuven, talked about Solvency II and Paul Stanley, Managing Director & UK insurance Lead, Accenture looked to the future of the insurance industry.

Sylvia Cronin, Director of Insurance Supervision at the Central Bank closed the conference, by informing delegates of the Central Bank’s priority outcomes for the insurance industry in 2019.

Notes:

Further information, including the conference programme is available on the Central Bank’s website.

The Solvency II Directive was transposed into Irish Law as the European Union (Insurance and Reinsurance) Regulations 2015 (S.I. 485 of 2015) and the legislation entered into force on 1 January 2016.