Solvency II will be delayed because of 'lack of urgency'

As reported in this week's issue of Post, the implementation date for the European directive on 1 January 2013 is to be delayed until 1 January 2014.

But the European Commission denied the claim before adding that certain areas may need a "transitional period".

John O’Neill, head of insurance consulting practice at Barnett Waddingham, he said: “The date is almost certain to be pushed back to accommodate European member states that are further behind the UK in terms of readiness for the January 2013 deadline.

“Other countries will not have the same sense of urgency as we do, so the Financial Services Authority’s assertion that all will be on time is highly unlikely.”

He said it would have “massive implications” for consultancy and in-house costs and would lead to uncertainty.

Mr O’Neill added that it would be “farcical” as no regulator would give more than a conditional approval to a company with its own model.

The current economic situation in Greece could also affect Solvency II.

He commented. “If Greece defaults, who is going to bail out the insurers in Greece and elsewhere?

“How can they manage the additional capital requirements of the Greek economy as additional capital would not easily be found throughout Europe.”