Solvency II Fails to Impose Transition Plans on Insurers

EU policymakers “fell short” during the latest round of negotiations on insurance regulation Solvency II this week when they failed to mandate transition plans for insurers, according to ShareAction. The final text instead requires European insurers to develop “prudential plans and targets” to address climate-related risks. Caroline Metz, Senior EU Policy Officer at ShareAction, said: “EU policymakers have missed a crucial opportunity to require insurers to break their ties with fossil fuels, the primary driver of climate change. The Solvency II revision was seen as a golden opportunity to push European insurers to develop robust transition plans with clear emissions reduction targets. However, the compromise, which focuses solely on insurers’ management of transition risks and ignores insurers’ impact, falls well short of what is needed for society and our planet.” Trilogue discussions for Solvency II are slated to take place in December. ShareAction has urged EU policymakers to bring forward key elements, such as including effective supervision and transparency in implementing prudential plans.  

 

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