Insurance tsar wants more power to stop firm collapses

THE chairman of Europe’s insurance regulator has called for more powers to prevent cross-border insurers like Qudos or Setanta collapsing.

Gabriel Bernardino told an event in Dublin that he wants to be able to take a more preventive approach rather than tackling issues as they arise.

EU insurers can do business here because of the single market. But the collapse of entities regulated abroad has hit Irish policyholders in the pocket, and raised questions about whether foreign-regulated insurers should be allowed here at all.

Mr Bernardino, chairman of the European Insurance and Occupational Pensions Authority, said that the crossborder insurance regime should be preserved because it can create more choice and competition.

He acknowledged however that there has been poor supervision in some countries, saying that when cases like Qudos or Setanta arise it “severely disrupts public trust in the function of insurance and the internal market”.

“We shouldn’t have these zombie companies in the market,” he said, adding that his organisation needs beefed up powers for giving orders to domestic insurance supervisors.

“We need ... to have the possibility to give clear and concrete recommendations to the home authority. And that this is dealt with as a recommendation coming from a European authority that needs to work on a ‘comply or explain’ basis.

“Nowadays I tell you we have been giving a lot of recommendations. Many of them have been followed, but others not so much. And that is not optimal.”