Mini-budget ‘music to the ears’ of UK insurers

Written by Adam Cadle

23/09/2022

The UK’s Chancellor Kwasi Kwarteng has confirmed that later this autumn the government is to bring forward an "ambitious deregulatory package" to "unleash the potential of the country’s financial services sector", including scrapping EU rules from Solvency II to free up billions of pounds for investment.

Delivering The Growth Plan 2022, dubbed the ‘mini-budget’, Kwarteng said EU law will be repealed for financial services and replaced with rules tailor made for the UK.

Clearwater Analytics President Europe and Asia Gayatri Raman said: “This mini-budget will be music to the ears of numerous insurers, who have been keeping a close eye on the progress of the Solvency II reforms. There is no doubt that the current requirements imposed by the EU have proven to be overkill in the eyes of many.

“There is a view that insurers have been forced to hold a huge pile of cash which, until now, they have been unable to put to work elsewhere – such as on alternative investment projects like green infrastructure. Insurers looking to invest in such projects will need to have the capabilities in place to support more alternative investment strategies, in the search for higher yields.”

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