European Insurance Watchdog Wants More Powers and Industry Levy

The European Insurance and Occupational Pensions Authority, the European Union’s insurance watchdog, called for extending its powers to include directly banning and restricting financial activities to enhance its supervision.

Eiopa, which is charged with drafting new solvency rules for European insurers, also wants to “explore partial financing by levying fees” on the insurance companies it regulates, according to a speech by Chairman Gabriel Bernardino, who is attending a public hearing on financial supervision in Brussels today.

The authority, which is one of the three European supervisory bodies for the financial industry, is currently funded by the European Union, which directly pays 40 percent of its budget, while the remaining 60 percent is paid by the member states.

Eiopa wants more flexibility in its financing and says exploring a levy as well as getting financing through an independent budget line in the EU’s general budget are steps “necessary in order to strengthen the operational independence of Eiopa” and to attract qualified staff, according to the speech.

Bernardino also wants direct access to information of individual insurers and to be able to directly conduct inquiries into financial institutions, products, or behavior. It currently has to go through local supervisors.

“This power should not be confined to situations of potential threats to the stability of the financial system but be used more generally to support the independent challenging role of Eiopa,” Bernardino said.

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