Insurers in Europe may need to put aside money to protect their policyholders should they become insolvent, and regulators should be able to be shut them down swiftly without the need for taxpayer bailouts, a top EU official said on Wednesday.

However the European insurance industry body said it opposed such moves, saying there were already safeguards in place and that the new requirements could hit the sector’s global competitiveness.

Valdis Dombrovskis, vice president of the European Commission and responsible for financial services, said the 11-trillion-euro ($12.2 trillion) European insurance sector faced growing cyber and climate risks.

The European Union is about to review its four-year old capital rules for insurers known as Solvency II, and Dombrovskis said a gap may need plugging.

“There is no EU-wide resolution regime for the insurance sector in the event of distress, and no minimum EU rules on insurance guarantee schemes,” he said in a speech in Brussels.

The bloc introduced a “recovery and resolution” regime for banks after the 2007-09 financial crisis, a set of requirements that enable regulators to close down ailing lenders in a quick and orderly way without taxpayer bailouts.

An insurance guarantee scheme, already available in some EU states, provides last-resort protection to consumers when an insurer becomes insolvent and unable to pay out on a policy.

“If every EU country had insurance guarantee schemes, it would benefit policyholders, taxpayers and the insurance sector as a whole,” Dombrovskis said.

EU states and the European Parliament are already looking at this concept as they finalize new rules for car insurance, he said. The bloc’s insurance regulator EIOPA has been asked for advice on creating a resolution system.

However trade body Insurance Europe said there was already a global framework for dealing with systemic risks and EIOPA wanted to “gold plate” it.

“Given all the protection already offered by Solvency II, this makes no sense and is definitely not helpful to EU insurers’ global competitiveness,” Insurance Europe president Andreas Brandstetter said.

The review will also look at whether requirements on insurers to report data on their activities could be lightened.

But Dombrovskis said he will ask an EU advisory body on accounting to work on new standards requiring insurers and other companies to give “sufficient and reliable” information on sustainability issues.

The EU will assess how insurers integrate climate and environmental risks, and how to strengthen the sector’s resilience to natural disasters, Dombrovskis said.

Insurance Europe says Solvency II is too punitive in capital requirements on long-term savings and investments, and Dombrovskis said these issues would be looked at.

The European Commission has powers to propose changes to Solvency II that would need approval from EU states and the European Parliament, a process that would take several years.

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