EU and US reach agreement on Solvency II equivalence

“U.S. and EU representatives are pleased to announce the conclusion of successful negotiations on an agreement that will ensure on going robust insurance consumer protection and provide enhanced regulatory certainty for insurers and reinsurers operating in both the U.S. and the EU,” negotiators said in a joint statement issued on 13 January 2017.

The long awaited Agreement covers three areas of prudential insurance oversight: reinsurance, group supervision and the exchange of insurance information between supervisors.

The final legal text of the Agreement was provided to the US Congress on 13 January. The European Union will follow the necessary steps in Council and Parliament.

Since October of last year there had been strong signs that an agreement could be reached. A joint public statement in November concluded: “U.S. and EU representatives continued to make progress, identifying negotiation points of convergence and areas requiring further work, and developing textual elements for inclusion in a possible agreement.”

Following two meetings in December the joint statement stated that representatives: “made significant progress on steps identified toward a possible agreement.”

It is unclear what implications the incoming US administration will have on the agreement.

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