Solvency II, the EU directive which will massively increase capital requirements for UK life companies, has been postponed for two months.
EU commissioner for financial services Michel Barnier said the European prudential framework will now be implemented by 31 December 2012, to align the rules to the financial year of most European insurance companies. Speaking in Brussels on Tuesday, Barnier played down fears Solvency II, which forces insurers to closely match the amount of capital they hold to the risk on their balance sheets, would force most insurance companies to turn to shareholders for cash. "We do not expect the entire European insurance industry to increase their capital by virtue of the changeover to Solvency ...
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