The Federation of European Risk Management Associations (Ferma) has urged brokers and insurers to find ways to support clients who are struggling to pay premiums on time or in full because of the strains caused by the coronavirus pandemic.
This follows a similar statement issued by Belgian risk management association Belrim that asked insurers and brokers to take “supportive measures”, as members struggle to find the funds to pay already hardening premiums on time.
“Many businesses are under strain because of the combined pressures of the pandemic and the harder insurance market. This help could make a real difference to them,” commented Ferma president Dirk Wegener.
Mr Wegener added that he hopes insurers will follow the recommendations recently issued by the European Insurance and Occupational Pensions Authority (EIOPA), which allow insurers greater flexibility in their deadlines for supervisory reporting and public disclosure.
The flexibility offered by the regulatory body will hopefully give the insurers the breathing space to provide customers with similar flexibility at this time of crisis.
Belrim’s call for “supportive measures” from insurers and brokers came in the form of a joint statement from its president Sabine Desantoine and vice-president Gaëtan Lefèvre.
“Representing about 100 companies from various industries, Belrim wishes to address the insurance market in the light of the coronavirus,” they said. “The current crisis puts a lot of strain on our members. This, combined with the severe hardening of the insurance market, means many companies may have financial difficulties to meet the deadlines or amounts of their insurance premiums. We therefore urge insurers and brokers to take this into consideration and to implement supportive measures towards their clients,” added Ms Desantoine and Mr Lefèvre.
Ferma also pointed out that EIOPA’s recommendations on reporting are expected to cover all insurers, including captives. The federation advised risk managers with EU-domiciled captives to contact their national insurance regulator to find out how EIOPA’s recommendations will be implemented locally.
EIOPA’s recommendations are partly inspired by a desire to maintain a relatively consistent approach by national supervisors as they react to the crisis.
“As some competent authorities are already taking measures to address the implications of the coronavirus/Covid-19, it is of utmost importance to provide a framework for consistent supervisory approaches urgently. Therefore, the general objective of these recommendations is to foster convergence and consistent supervisory approaches across member states when providing flexibility for supervisory reporting and public disclosure of insurance and reinsurance undertakings,” stated EIOPA.
The recommendations national supervisors to:
- Accept an eight-week delay in the submission of the Regular Supervisory Report, both at solo and group level
- Accept a one-week delay in the submission of the Q1-2020 Quantitative Reporting Templates and the Quarterly Financial Stability reporting, both at solo and group level
- Accept an eight-week delay for the publication of the Solvency and Financial Condition Report with the exception of balance-sheet, LTG, own-funds and SCR calculations, both at solo and group level.
EIOPA did add, however, that if insurers and reinsurers wish to file earlier than the recommended delay period they are free to do so.
“The recommendations aim to offer operational relief and support business continuity of insurance and reinsurance undertakings. However, the insurance and reinsurance undertakings may opt for submitting the full reporting package at any time before the shortest delay indicated below. This option may also be chosen in case of any unintended burden created by the proposed reliefs in specific situations (for example when splitting the reporting packages into two sets),” explained the supervisory body.