SII adjustments ‘should not thwart EU Green Deal plans’ - GDV

Written by Adam Cadle

24/09/2020

Adjustments to Solvency II “should be coordinated as ideally as possible with the EU’s Green Deal plans”, and “not thwart them”, member of the GDV executive board and chairman of the management Jörg von Fürstenwerth has said.

Von Fürstenwerth warned EIOPA’s proposals do “not provide enough impetus for long-term investments” and even “make them more difficult”.

“Our predestined role as a provider of capital for sustainable large-scale projects, such as wind farms, would be weakened. One example are the drafts for modelling long-term liabilities. They would greatly increase the model-related fluctuations.”

The German Insurance Assocation believes the extrapolation method used for the risk-free rate curve should not be changed, the effectiveness of the Volatility Adjustment should be increased, the Dynamic Volatility Adjustment should be included in the standard model, and the proposed calibration of the interest rate risk should be improved.

“Addressing these topics in a consistent manner will enable and promote the achievement of other impriotant EU politcial objectives such as the Capital Markets Union, the European Green Deal and the economic recovery after COVID-19.”

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