1 thought on “Anti-competitive regulations and the harm they cause (Part 8)”

  1. Posted 01/09/2018 at 17:21 | Permalink

    Dear Catherine,

    Thank you for your article. I couldn’t agree more, although I must say you’re being modest in pointing out inappropriate capital requirements as the (only) problem of Solvency II.

    In my experience, most specialty insurers have a good grasp of the risks they are taking and are holding capital often in excess of the standardised Solvency II requirements. It’s not primarily the standard capital requirements that are anti-competitive.

    For smaller and specialised insurers, the major headache are the governance and reporting requirements. The red tape and associated costs are mind-boggling. Solvency II seems designed to sweep away smaller players. In fact, the head of a very large EU insurance group said several years ago that they were looking forward to Solvency II, as in his opinion there was no place in Europe for insurers that were smaller than any of the group’s regional offices.

    Solvency II was a good idea that has had a terrible execution at the hands of well-meaning technocrats, who did not know when to stop. The sooner the UK can implement a competing regulation, the better for us all.

    Regards.
    Walther Neuhaus

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