CEA

CEA Annual Report 2007–2008

I ns ur e r s of Eu rope

Annual Report 2007–2008

 Annual Report 2007–2008

CEA

The CEA is the European insurance and reinsurance

federation. Through its 33 member bodies, the
national insurance associations, the CEA represents all
types of insurance and reinsurance undertakings, eg
pan-European companies, monoliners, mutuals and
SMEs. The CEA represents undertakings that account
for approximately 94% of total European premium
income. Insurance makes a major contribution to Europe’s
economic growth and development. European insurers
generate premium income of €1 110bn, employ over
one million people and invest more than €7 200bn in
the economy.

www.cea.eu
Contents
Foreword 4

European insurance in figures 6

The CEA’s key dossiers

Solvency II 10

Climate change 13

Competing products 16

Reinsurance 18

Single Market Review 20

European motor insurance 23

IFRS 4 Phase II 26

EC inquiry into competition issues 28

VAT – Insurance and Financial Services Review 30

Compulsory liability 32

Social dialogue 34

The CEA

Events 36

Publications 38

Reorganisation 40

Presidential Council 41

Member associations and presidents 42

Director Generals’ Conference 45

Committee chairpersons 48

Staff 50
 CEA Annual Report 2007–2008

Foreword

The last year has been a turbulent and challenging one for the world’s markets. Nevertheless,
the 27 countries of the European Union achieved GDP growth of 2.9% in 2007, slightly higher
than the 2.2% growth in the US, which has been particularly hard hit by the liquidity crunch
triggered by the problems in the US sub-prime mortgage sector.

European economies have been boosted by growth in internal demand, offset by exports
affected by the strength of the euro against the dollar. Despite the efforts of the central
banks to reduce the impact of the credit crisis, the financial turmoil inevitably affected the
economy in 2007 and continues to do so in 2008, and it looks set to persist into 2009.
The financial sector has borne the lion’s share of the costs of the crisis but, of the various
financial institutions affected, the banks have been hardest hit with first analyses suggesting
that insurance companies will avoid the worst (see p9).

Europe’s insurers, as well as their primary role of providing protection to the continent’s citizens,
also make an impressive contribution to the economy. Our estimates suggest that the total
amount invested by insurers was a staggering €7 283bn in 2007.

The EU’s large (re)insurance groups continue to lead the world in terms of financial strength
and size, while its small and medium-sized insurers remain the mainstay of the industry. The
European insurance market is highly competitive, which largely explains the very small increase
in its total premium income in 2007; from €1 086bn in 2006 to €1 110bn (see p6).

These are challenging times for all financial sectors, not least the insurance market. Amid the
economic challenges, financial services, and within them insurance, also remain a key focus
of the European Commission in its drive to create a better regulated, more integrated single
market. As a result, there are many EC initiatives that require monitoring by and input from
the CEA.

The EC’s Solvency II draft Framework Directive (see p10) has been the key focus of CEA activity
over the last 12 months. We have been working to ensure that Solvency II is a workable risk-
based supervisory system. It is essential that Solvency II is a prudential regime that is suitable for
all EU insurers, irrespective of size, and to that end the CEA’s objective has been to ensure that
the principle of proportionality is appropriately applied in the Directive and that the supervision
of insurance groups accurately reflects their economic reality and allows the efficient allocation
of capital within their organisations.
CEA Annual Report 2007–2008

The parallel development of Phase II of the International Financial Reporting Standards by

the International Accounting Standards Board (see p26) is another important dossier for the
CEA, not least to ensure that there is no conflict between the new accounting rules that are
developed and the Solvency II draft Directive.

Of course, the CEA has been, and continues to be, active on a wide range of other issues. Our
members are conscious of the pivotal role they play in addressing issues such as climate change
and demographic change. Experience in risk-mapping, raising risk awareness and incentivising
behavioural change, for example, have put (re)insurers at the forefront of activities to mitigate
and adapt to climate change (see p13).

The EC’s efforts to improve competitiveness in European markets have brought into question
the insurance Block Exemption Regulation. The CEA has been working to demonstrate the
positive effect of this exemption on the competitiveness of the insurance sector. Meanwhile,
the CEA has been monitoring and contributing to many other initiatives. The EC’s review of
VAT on insurance and financial services (see p30) is just one example.

As well as turbulence in the financial markets, the last year has also been a turbulent one at
the CEA, albeit in a positive rather than a negative way. On page 40 you can read about the
transformation of our secretariat. The CEA is now better able to promote the views of the
insurance industry efficiently and effectively to European and international institutions and the
wider public. We look forward to continuing to represent Europe’s (re)insurers, large and small,
listed and mutual, on the wide range of EU issues that concern them.

Gérard de La Martinière Michaela Koller

CEA President CEA Director General

 CEA Annual Report 2007–2008

European insurance in figures

Competition lowers growth in premium income

Against a background of relatively good in the 15 old EU member states and a growth
economic growth, affected nevertheless by rate of over 20% in the 12 new member
the financial turmoil of the second half of the states. Figures for those central and eastern
year, the insurance sector in Europe recorded European countries, which still have a relatively
only a very slight increase in total premium small share of the total life market (around
income in 2007 of 0.1% in real terms. This is 2.5%), were boosted by economic growth,
the lowest growth rate since the significant strong savings growth and the development
drop recorded in 2001 and it is mainly due of occupational schemes.
to strong competition between insurers and
The decrease recorded in western Europe
between the different financial sectors.
seems to demonstrate that the market
Total premium income amounted to €1 110bn has reached a certain level of maturity (life
against €1 086bn a year earlier, while total premium income per inhabitant was close
insurance industry investments increased by to €1 200 in 2007, against €680 in 1998).
2.2% to €7 283bn. It may also reflect the decrease in the saving
growth rate in several countries. However,
Life growth in the east
in the context of an ageing population and
Total life premiums grew by 0.1% (in real uncertainty regarding future pension levels,
terms) to reach €688bn, against €674bn in life insurance has potential for growth in
2006. This small increase is made up of two several countries. In addition, the disparities
different developments; a decrease of 0.4% in the penetration rate (premium/GDP) and in
the ratio of population to premium income
European insurance premiums and growth — 2006-07
Premium income (€bn) Growth rate (%)
2006 2007 Nominal Real
Life 673.9 688.3 2.1 0.1
Non-life 412.1 421.8 2.4 0.2
  Motor 127.7 129.1 1.1 -1.1
  Health and accident 121.8 126.0 3.4 1.4
  Property 79.8 81.4 2.0 -0.2
  General liability 33.3 33.5 0.6 -1.4
  Legal expenses 6.5 6.9 6.2 3.3
Note:
All 2007 figures in this article are   Marine, aviation, transport 16.3 16.6 1.8 -0.6
provisional data and are subject
to change. Growth rates are   Other non-life 26.6 28.4 6.8 4.3
always inflation adjusted. The
complete data for 2006 and basic          
data for 2007 will be available
on the CEA website in July 2008. Total 1 086 1 110 2.2 0.1
CEA Annual Report 2007–2008

demonstrate that further increases can be
expected in several countries.
Little change in non-life
The non-life insurance market grew by
0.2% to €422bn, against growth of 6.2%
in 2006 that was due to the privatisation of
health insurance in the Netherlands. 2007’s
low growth reflects the strong competition
between insurers and confirms the soft market
already observed in 2006. The insurance
cycle, with hard market conditions and rate
rises followed by soft market conditions and
rate reductions, is mainly seen by economists
as an indicator of the strong competition
between insurers. As in life business, this
low growth rate concerns almost exclusively
western markets, where nine countries
recorded negative growth, while eastern
markets showed growth of almost 7%.
Tough motor competition
With a 31% share of all non-life premiums,
motor insurance is the largest non-life business
and is particularly competitive, with more than
1 000 companies competing to sell contracts
for around 300 million vehicles in Europe (see
p23). Total premium income fell 1.1% (in real
terms) in 2007 to €129bn, compared with
€128bn in 2006. This is the second consecutive

Premium growth by country

<-5%

-5% - 0%

0% - 5%

5% - 10%

>10%

CZECH REP.

SWITZERLAND

TURKEY

GREECE

CYPRUS

Note:
All 2007 figures in this article are
provisional data and are subject to
change. Growth rates are always inflation
adjusted. The complete data for 2006
and basic data for 2007 will be available
on the CEA website in July 2008.
European insurance premiums and growth — 1995–2007
Total premium income
1 200
€bn
1 000
800
600
400
200
0 -4%
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
year of decline in total European premiums and
it reflects insurers’ efforts to maintain and even
increase value to customers. In previous years,
the decrease or the low growth in premiums
has been made possible by the reduction in
claims expenditure. Since 2006 this reduction
has been less marked and increases pressure
on insurers to be even more cost efficient in
order to offer further premium reductions.
These reductions have been accompanied
by a broadening of the insurance on offer to
include, for example, pay-as-you-drive and
special rates for good drivers and for those
driving only a few kilometres.
Variations in health & accident
With premium income of €126bn in 2007, health
and accident insurance is the second largest non-
life business line. Total premiums grew 1.4%
over 2006, concealing variations from falling
premiums in several Nordic countries to growth
above 10% in many eastern countries. This
market is mainly driven by the Netherlands and
Germany, which together represent about 57%
of the total due to the complete privatisation of
health insurance in the former in 2006 and its
partial privatisation in the latter. In most other
markets, health insurance intervenes mainly as
a complement to social security.
CEA Annual Report 2007–2008
Growth (inflation-adjusted)
14%
12%
10%
8%
6%
4%
2%
0%
-2%
Change in property & general liability
Property insurance recorded premium income
of €81bn, against €79.8bn in 2006, which
represents nominal growth of 2% but a
real decrease of 0.2%. This decrease is the
first in seven years and reflects the strong
competition in both the household and
business insurance markets. It contrasts with
the increase in building prices, although the
latter has slowed down in recent years.
General liability insurance, which is sold to
both firms and households, also recorded a
real decrease of 1.4% against an increase
of 1.4% in 2006. As for other non-life
business lines, this drop relates to the strong
competition between insurers. However,
general liability is characterised by its long-
tail nature, which allows insurers to benefit
from higher investment income than short-
tail non-life markets.
Investment slowdown
The total amount invested by insurers in the
economy, estimated at market value, reached
approximately €7 283bn in 2007, against
€6 994bn in 2006. This represents real growth
of 2.2% (4.8% in 2006). This slowdown in
investment growth is mainly due to the lack
CEA Annual Report 2007–2008
of growth in life business, which has also been
affected since 2006 by a rise in the benefits
paid. Life investments, which represent more
than 80% of the total, grew by 2.4%, while
non-life investments increased by 1.4%.
Financial turmoil
Turmoil in the world’s financial markets has also
slowed the growth in investments. However,
insurers’ results and the first studies currently
available show that the European insurance
industry has not been seriously affected by the
financial crisis and that the losses incurred by
insurance companies are manageable.
According to a study led by the International
Monetary Fund, the total share of the
worldwide insurance industry in the cost of the
financial crisis should be around 12%, with the
vast majority of the costs shouldered by banks,
pension funds, hedge funds and other investors.
Moreover, this cost will vary by region and first
estimates suggest that the European insurance
industry will avoid the worst impact.
There are various reasons for this. The need
for insurers to cover euro liabilities with euro
investments has stopped them investing
significantly in US assets. More generally, to
European insurers’ investments — 1995–2007
Life Non-life
8000
€bn
7000
6000
5000
4000
3000
2000
1000
0 -2%
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
match their investments with their liabilities,
insurers invest mainly in products with a financial
profile and risk consistent with the financial
characteristics of their liabilities. This leaves very
little room for speculative investments. Also,
the financial crisis of 2001-02 seriously affected
insurers, who revised their investment strategy
at the time by improving their risk assessment. It
is also worth stressing that investment revenue
is only part of an insurer’s revenue and so they
often prefer to invest conservatively.
However, insurers are affected by the financial
crisis in several ways. Firstly, the decrease in
the value of assets recorded on most financial
markets has reduced the value of insurers’
investments and may for a while decrease the
solvency margin of insurers. Secondly, some
insurers such as monoline insurers specialised
in credit risk cover and directors & officers and
errors & omissions insurers may be directly
affected by the problems stemming from the
US sub-prime mortgage market. Finally, as
insurers are often part of a larger financial
group, insurance companies may suffer
damage to their reputations or be required
to provide liquidity to other branches in the
group.
Growth (inflation-adjusted)
16%
14%
12%
10%
8%
6%
4%
2%
0%

10
Solvency II
A risk-based economic framework for insurance supervision
The CEA aims to ensure that Solvency II can meet its stated objectives
of enhancing policyholder protection, increasing the competitiveness of EU
(re)insurers and ensuring the efficient allocation of capital.
The EC launched its proposal for a Framework
Directive on Solvency II, the new solvency
system for (re)insurers, on 10 July 2007. The
Sub-prime crisis
The liquidity crisis that originated in
the US sub-prime mortgage sector has
drawn a lot of attention to the Solvency
II proposal. European policymakers and
the press rushed to find out how the
ensuing liquidity and credit crisis could
affect insurance undertakings and where
these risks are tackled by the Solvency II
standard approach or internal models.
The current liquidity crunch is having a
severe impact on the banking sector, but
seems to have left insurance relatively
unscathed. This is because insurance
companies have relatively long-dated
and stable liability cash flows and invest
more heavily in assets with large, well
established, deep and liquid markets,
such as listed equities, government
bonds, etc. Insurance companies tend to
be a source of liquidity as they need to
invest the premiums they receive from
policyholders.
In contrast, banks typically have short-
dated and easily withdrawn liabilities
(deposits) backed by a significant
proportion of relatively illiquid assets
(mortgages). They are therefore much
more vulnerable to liquidity risk.
CEA Annual Report 2007–2008
text is currently being discussed in the Council
and the Parliament as part of the Level 1
negotiations in the EU decision-making
process.
The CEA welcomed the publication of the
Framework Directive. Indeed, the new
Solvency II articles are in general well written,
comprehensive and aligned with an economic
approach to solvency assessment, which
the industry strongly supports. The industry
appreciates the high quality of the work
done to date and the constructive dialogue
it has had with the EC and the Committee
of European Insurance and Occupational
Pensions Supervisors (Ceiops).
The Framework Directive incorporates a
range of features, which the industry has
long strongly advocated. These include:
• use of a risk-based economic approach,
which ensures that the true underlying
exposures of risks and risk mitigation
schemes can be correctly reflected,
thereby eliminating regulatory arbitrage
opportunities that can distort and weaken
the protection available to policyholders;
• a market-consistent approach for valuing
assets and provisions;
• recognition of diversification benefits;
• allowance for the risk absorption available
on certain liabilities, eg profit-sharing
business and deferred tax provisions;
• transparency: unlike other solvency
regimes, Solvency II does not confuse
CEA Annual Report 2007–2008
prudence and capital requirements by
incorporating implicit margins in the
technical provisions’ liabilities;
• allowing companies to develop more
sophisticated models to determine their
capital requirements (so-called internal
and partial models), subject to approval
by supervisors;
• significantly increasing the level of
harmonisation across the EU, which will
reduce overlaps in supervision, increase
competition and product innovation;
and,
• moving towards a more appropriate
way of supervising groups and an
integrated EU market that recognises
the economic reality of groups. The
CEA strongly supports the concept of
a group supervisor who has primary
responsibility for key aspects of group
supervision, in close cooperation with all
the other supervisors involved. This will
allow a more streamlined and effective
supervision of groups, which is both
welcome and appropriate.
Outstanding issues
Nevertheless, the insurance industry believes
certain areas need further work. One of
these is the calculation of the proposal’s two
capital requirements, the minimum capital
requirement (MCR) and the solvency capital
requirement (SCR). Policymakers have not
yet made up their minds whether the SCR
(a target level sufficient to cover all 1-in-200
year events) and the MCR (which will trigger
immediate supervisory intervention) should
be calculated consistently.
The MCR should be expressed as a percentage
of the SCR in order to ensure that the two
targets are based on the same risk-oriented
11
principles and move in the same direction
in adverse circumstances. A ”compact” (or
“percentage of the SCR”) approach for the
MCR is the only way to allow the consistent
application of the ladder of supervisory
intervention measures. This was clearly
demonstrated by the second and third
quantitative impact studies, QIS2 and QIS3.
Group supervision
The CEA rapidly realised the need to set
up a network of industry experts whose
main task would be to clarify the industry’s
interpretation of the Commission’s proposal
on group supervision. This work culminated
in the release of two CEA publications: “FAQs
on Group Supervision & Group Support
Regime” and “How the Group Support
Regime works in practice (Case Studies)”.
Solvency II and
Occupational Pension Funds
While stressing the need to keep to
the Solvency II timetable for insurance
companies, the CEA fully supports plans
to further examine how to apply solvency
requirements to occupational pension funds.
Life insurers and occupational pension funds
are both pension providers and are as such
in competition across the EU.
Life insurance policyholders will benefit
from the high levels of protection to be
delivered by Solvency II and comparable
protection should also be provided to
customers of pension funds where these
present the same risk. Ultimately, it is in
the interest of the market to see consistent
supervisory systems for all providers of
pension solutions to help avoid regulatory
arbitrage and achieve equivalent levels of
consumer protection.
 CEA Annual Report 2007–2008

12

The CEA believes that Solvency II should Work with Ceiops

aim to improve the current supervision of
The Committee of European Insurance
groups without it meaning the end of solo
and Occupational Pensions Supervisors
supervision. Much of the supervision will
(Ceiops) has completed several sets of
remain at solo level, including the evaluation
Advice called for by the EC in respect of
of insurance liabilities and the fieldwork
the Framework Directive.
performed by solo supervisors to ensure a
sound internal control and risk management Ceiops’s further advice to the EC on
environment. groups and the implementation of the
proportionality principle was due in May
Group support is in itself a “tool” to allow
2008 after a two-month consultation. The
the same confidence level for the capital
CEA responded in April 2008 to the two
requirement of a group as for stand-alone
consultation papers, CP24 and CP25.
entities (99.5% confidence level). It should
be a practical and transparent instrument to Ceiops’s third quantitative impact study
allocate capital in the most efficient way and (QIS) provided further insight into the
allow groups to benefit from the recognition calibration of the standard approach
of diversifications effects. used for calculating the solvency
The CEA’s Solvency II
publications are capital requirement (SCR) and further
This has been highlighted by CEA
available to download information on a wide range of elements
free of charge on its representatives in a series of meetings
website, www.cea.eu of the Solvency II proposal. However, it
with regulators and supervisors of states
fell short of adequately testing the group
not in favour of the group support regime
supervision proposal.
proposal.
Stakeholders’ eyes are now on QIS4’s
ability to provide an insight into the
Overview of EU insurance market standard approach for groups and a
series of proposed Pillar I simplifications.
Split of the market share by company size (estimate)
Additional work is required to clarify
2%
13% 85% a number of technical details and to
Large companies

Medium-sized companies
ensure that the calibration of the model is
Small companies appropriate for all insurers.

The CEA has held workshops on QIS4

Split of the number of undertakings by company size (estimate)
to provide an insight into the technical
79%
6%
15%
specifications and enhance industry
Large companies
participation. Valuation assumptions will
Medium-sized companies
continue to be a priority for Ceiops and
Small companies
the industry.

Total: 5 000 companies

CEA Annual Report 2007–2008
Climate change
Promoting mitigation, adaptation and innovation
The need for early, collective and coordinated action on climate
change has not only been stressed by several politicians, insurers and other
stakeholders but also by Mother Nature herself.
There was an increase in extreme weather
events in 2007. This is recognised as being
one of the most noticeable changes to
result from global warming, according to
a 2006 study by the Centre for Health and
the Global Environment at Harvard Medical
School in the US. And as EU Environment
Commissioner Stavros Dimas recently said:
“2008 has the potential to become a defining
year for climate policy, in the EU as well as at
international level”.
European officials have been very active on
the international scene negotiating the terms
of the international climate agreement to be
signed in Copenhagen in 2009. A first step
was achieved in December 2007 with the
adoption of the so-called Bali action plan. It
identifies, among other things, the need for
“enhanced action, including vulnerability
assessments, the prioritisation of actions,
capacity-building, risk management and
risk reduction strategies, disaster reduction
strategies and economic diversification to
build resilience”. Europe is also leading the
debate by example. This is crucial not only for
its credibility but also for its own future.
Mitigation ...
The EC’s renewable energy and climate change
package, presented in early 2008, should be
adopted by the end of the year. Its proposals
aim to reduce European greenhouse gases
and increase the share of renewable energies.
As part of this package, the revision of the
13
Climate change in figures
• The most costly catastrophic event for
the insurance industry in 2007 was
January’s Kyrill storm, which caused
up to €10bn of damage (of which
€4bn insured) across many European
countries, according to Swiss Re.
• In the UK, 2007’s floods will cost
insurers £3bn (€3.8bn), according to
the Association of British Insurers.
• Other major events in 2007 included the
heatwave in Hungary, Romania, Greece
and Austria which killed 550 people, and
the forest fires in Greece which left 67
dead, 1 600km² land burnt and caused
an estimated €1.2bn of damage.
• Since the 1970s, economic losses as a
result of weather-related catastrophes
— adjusted for changes in wealth,
inflation and population growth/
movement — have increased on
average by 2% each year.
• The Stern Review published in October
2006 in the UK concluded that if this
trend continues or intensifies with
rising global temperatures, losses from
extreme weather could reach 0.5–1%
of world GDP by the middle of the
century and the overall costs of climate
change will be equivalent to losing at
least 5% of global GDP each year.
 CEA Annual Report 2007–2008

14

European Emission Trading System (ETS), Agricultural Policy, its Animal Health Strategy
an instrument which drives investments and its Communication on Water Scarcity
towards clean technology, aims to strike a and Drought, for compliance with climate
balance between ambitious climate targets change objectives.
and economic concerns.
The insurance contribution
... and adaptation
The insurance industry has been
The EC adopted a Green Paper in 2007 compensating for an increasing proportion
that explicitly raises the issue of the role of of economic losses from weather-related
insurance markets and launched the public disasters, up from 17% in 1980 to 28% in
debate at a conference in July, at which 2006 in Europe, according to Munich Re.
the CEA participated. A White Paper is
However, the insurability of these risks is
scheduled for November 2008 to present
threatened by the expected increase in the
the EC’s policy recommendations.
scale and frequency of natural catastrophes,
The EC has also started to reflect on Europe’s combined with an increase in the number
capacity to respond to disasters and on the of people, property and economic activities
need for a more comprehensive approach to at risk. The insurance sector’s help in
disaster prevention. The increasing number enhancing the insurability of climatic risks
of requests recorded by the European and facilitating mitigation is detailed in the
Solidarity Fund has relaunched the debate CEA’s 2007 report “Reducing the Social and
on the negative effects of unconditional Economic Impact of Climate Change and
compensation mechanisms and the need to Natural Catastrophes — Insurance Solutions
incentivise Member States to take action. and Public-Private Partnerships”.

The EC also scrutinises its other policy The (re)insurance industry will maintain its key
initiatives, such as its revision of the Common role in investigating and tackling the effects of

European weather-related disasters and economic and insured losses caused

50 250
Economic losses (2006 values)
45
Insured losses (2006 values)
40 200
Number of events
35
Number of events

30 150
€ bn

25

20 100

15

10 50

0 0
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006

Source: NatCatSERVICE, Geo Risks Research, Munich Re (July 2007)

CEA Annual Report 2007–2008

15

climate change, incentivising prevention and be required for the assessment, management
risk management and developing appropriate and transfer of risks.
insurance solutions. Its strong expertise in risk
assessment and risk modelling contributes
to a better assessment of climate change’s Case studies: Insurance initiatives
impacts and sound decision-making. The
In September 2007, the
industry has also been actively contributing
Association of British
to the work of the Intergovernmental Panel
Insurers launched
on Climate Change (IPCC).
ClimateWise, a global initiative open
In some EU Member States, the (re)insurance to signatories worldwide to encourage
industry has already developed flood-risk customers to change their climate-damaging
mapping and zoning tools, sometimes habits and to influence governments and
together with public authorities, and the CEA major organisations in matters of policy. The
has been cooperating on similar initiatives 39 signatories from the insurance industry
at European level, contributing for example are committed to taking action on climate
to the drafting of the EXCIMAP (European change and to reporting publicly on their
exchange circle on flood mapping) handbook own performance and their contribution to
describing good practices for flood mapping increased risk assessment and awareness.
in Europe. The (re)insurance industry also
In 2007, Swiss Re launched its Climate
has extensive experience of raising risk
Adaptation Development Programme
awareness and incentivising individuals and
(CADP), designed to develop a financial risk
businesses to behave appropriately through
transfer market for the effects of adverse
communication campaigns and pricing
weather in emerging countries. In its first
and underwriting policies. New insurance
phase, it aims to provide financial protection
products supporting mitigating actions have
against drought conditions for up to
already been launched — from specific
400 000 people in Africa.
insurances for hybrid vehicles to insurance
for new energy plants or insurance coverage Munich Re initiated the Munich Climate
for the risks related to clean development Insurance Initiative (MCII) in response to the
mechanism (CDM) projects. growing realisation that insurance solutions
can play a role in adaptation to climate
The (re)insurance industry has also developed
change. It provides a forum for insurers,
alternative risk transfer (ART) mechanisms, such
climate change and adaptation experts,
as weather derivatives or catastrophe bonds,
non-governmental organisations and
to transfer risk to institutional investors and
policy researchers, with the aim of finding
increase the financial capacity of the market.
insurance-related solutions. It contributes
Last but not least, insurers are reducing energy
to the identification and promotion of loss
consumption and adapting their purchasing
reduction measures and to the development
policies to make their own activities more
and running of pilot projects, with a special
climate-proof. Nevertheless, due to the scale of
focus on developing countries.
the challenge, public-private partnerships will

16
Competing products
Retail investment products and consumer protection
Only equivalent products should be regulated equally, so the
issue of a level playing field can only be determined after the examination
of all elements of regulation and products.
Ongoing innovation in the design of retail
investment products has led to greater
product diversity and increased choice for
investors. According to the EC’s Internal
Market and Services Commissioner, Charlie
McCreevy, “a wide range of investment
products are now available to help retail
investors take responsibility for their long-
term financial futures”. However, depending
on the legal form the product takes, the EU
legislative framework imposes different levels
of product and fee disclosure requirements,
and different selling rules.
Call for evidence
The EC made a call for evidence in October
2007 on the need for a coherent approach
to product transparency and distribution
requirements for “substitute” retail
investment products. The term “substitute”
products refers, according to the EC, to the
trend, from the consumer’s point of view, for
retail investment products offered by banks,
insurers and fund managers to become
less differentiated. The EC aims to examine
whether the fragmented regulatory landscape
creates unacceptably large variations in
disclosure and in conduct-of-business rules,
resulting in significant risk to investors, and
whether there is a need for further action in
this area.
In general, the CEA believes that there should
be a level playing field for equivalent financial
products, but that a level playing field can only
CEA Annual Report 2007–2008
be determined after examining all elements
of regulation and products. A variety of
product-specific EU regulations already exists
for life insurance (eg Life Assurance Directive,
Insurance Mediation Directive). Given the
different national regulatory frameworks,
a horizontal approach would give rise
to enormous difficulties and the specific
Apples and pears
Unit-linked life insurance products differ
from UCITS (undertakings for collective
investment in transferable securities)
funds, so trying to compare them is like
comparing apples and pears. The EC set
this out in a White Paper on enhancing the
single market framework for investment
funds. Life insurance includes, as its name
clearly suggests, an element of “life cover”
that provides benefits to a designated
beneficiary if an uncertain event related
to the life of the insured occurs. Mere
investment products do not.
Life insurance companies must hold
sufficient solvency margins based on
prudent mathematical provisions and hold
own funds to ensure that any benefits will
be paid. Life insurance products, according
to a large EC survey, offer security and
certainty to the customer. Therefore
unit-linked life insurance products serve
different consumer needs to other retail
financial products.
CEA Annual Report 2007–2008
characteristics of individual life insurance
products would not be taken sufficiently into
account.
The level of information provided to consumers
should match their needs. In terms of pre-
contractual information, the Life Assurance
Directive requires insurance companies to
inform the policyholder about benefits,
contract terms, means of termination of the
contract, premiums, taxation and applicable
law and to give an indication of surrender and
paid-up values and the extent to which they
are guaranteed. For unit-linked life insurance
policies, a definition of the units to which the
benefits are linked and an indication of the
underlying assets are required.
An overload of information may prevent
consumers from making an appropriate
assessment of a product. The CEA believes
that providing high-quality rather than
excessive information is a basic principle for
consumer protection, so it strongly supports
the simplification and rationalisation of
existing disclosure requirements, rather than
adding more.
More complexity, more information
Existing conduct-of-business rules result
from differences in the characteristics of
products. The more complex the product,
the higher the level of information required.
The Insurance Mediation Directive (IMD)
17
requires intermediaries to specify customers’
needs and demands and to provide them
with clear explanations. It also stipulates that
intermediaries should get formal education
and demonstrate their ability to provide
advisory services on life insurance products.
Since in some Member States the insurance
industry has taken additional self-regulatory
measures, in the CEA’s opinion there is no
evidence that existing codes of conduct are
detrimental to consumers.
The IMD obliges intermediaries to inform the
customer if they are doing business exclusively
with one insurer. In insurance mediation
markets the relationship with the customer is
often long-term. This presumes a high degree
of confidence from each party involved and
reduces considerably any conflict of interest.
The CEA supports the EC objectives of
ensuring a higher level of consumer protection.
However, only a tailormade, product-specific
approach is appropriate. The CEA believes that
there is actually no evidence that the existing
insurance-specific regulation framework at EU
and national level is inadequate to protect the
consumer. As the IMD has only recently been
transposed in all Member States, a little more
time is necessary to gain enough experience
from its implementation and assess its impact.
Effective consumer protection should take
into account the different levels of complexity
of financial products. The CEA believes that
any alignment of the regulatory framework
made on the assumption that investment
products are substitutes could interfere
with the capacity of the market to develop
innovative and consumer-oriented solutions.
The EC is expected to publish its conclusions
on the need for further action in this area in
autumn 2008.
 CEA Annual Report 2007–2008

18

Reinsurance
Regulatory review in the US
Reinsurance is a global business and US regulatory
reform that will put foreign reinsurers on a equal footing with US reinsurers
is much needed and long overdue.

The debate about the regulatory framework
for reinsurance and collateral requirements
for credit-for-reinsurance in the US has been
going on for 20 years in Washington and
seven years at the National Association
of Insurance Commissioners (NAIC) (see
timetable on p19). The issue is frequently on
the agenda in the EC’s dialogue with the US,
particularly now the EU is considering how
to treat non-EU regimes under its proposed
Solvency II regulatory regime. During NAIC
meetings in 2008, the EC, together with the
UK and German regulators, has corrected
misinformation that US reinsurers would
face barriers to trade in Europe under the
current and proposed (Solvency II) regimes.
The NAIC agreed to start reforms of the US
credit-for-reinsurance regime in December
2006. Its reinsurance task force revised an
original proposal for a Reinsurance Evaluation
Office in September 2007. The revised proposal
would establish a Reinsurance Supervision
Review Department, which would assess the
regulation of non-US jurisdictions to determine
whether they are entitled to enter into mutual
recognition arrangements. A company from an
approved jurisdiction would then be certified
to access the US market through a “port of
entry” state. The NAIC unanimously adopted
this framework proposal in December 2007,
albeit with numerous issues still to be resolved
as the task force draws up a draft model law.
Federal and state
As well as campaigning for change to the
existing collateral regime, the CEA and the
European insurance industry have frequently
expressed support for federal as well as state
regulation of (re)insurance in the US. Despite
the efforts of the NAIC to foster greater
uniformity through the development of
model laws and other coordination efforts,
(re)insurers still operate under different
laws, licensing requirements and regulatory
examinations in each state.

Costly collateral Two bills in this area were introduced into

the US Congress in 2007, the National
Foreign reinsurers operating in the US are
Insurance Act, better known as the Optional
required to maintain collateral in US trust
Federal Charter (OFC), and the Non-admitted
funds that is equivalent to 100% of their
and Reinsurance Reform Act (NRRA). The
US liabilities, regardless of their financial
OFC would give (re)insurers the option of
strength, credit rating or reinsurance
obtaining a federal licence and restricts
cover. This onerous requirement creates
the ability of states to regulate reinsurance
significant extra cost for foreign reinsurers,
ceded to federally-licensed reinsurers. It also
whose US-based competitors are not
permits federally-licensed insurers to take
required to post such collateral.
CEA Annual Report 2007–2008

19

credit for reinsurance ceded to federally- with a US licence. In April 2008 the US
licensed reinsurers, but does not provide any Treasury recommended the establishment
relief to cross-border reinsurers operating of the OFC.

There is little optimism about prospects for

Timetable for change early progress on the OFC, and the NRRA,
in its current form, delivers little for US or
NAIC regulators recognise
European reinsurers. None of the proposals
need for system for credit-
for-reinsurance standards under discussion at the NAIC, in key states
November ‘04
that treats all reinsurers
and in Washington delivers an ideal and
equally regardless of
domicile complete solution to the current issues faced
NAIC White Paper notes by European reinsurers.
that “many of the largest,
oldest and financially
strongest reinsurers are The CEA keeps in close contact with US
March ‘06
located abroad, and the industry associations — the Reinsurance
capacity they provide
is very important to US Association of America, the American
ceding companies” Insurance Association, the American Council
NAIC Reinsurance Task of Life Insurers, the NAIC and the National
Force adopts Reinsurance Conference of Insurance Legislators to
December ‘06
Evaluation Office (REO)
proposal discuss US regulatory reforms. The issue
of these reforms is also on the agenda of
Two bills introduced
in Congress: National the OECD Insurance Committee and the
Insurance Act, known as
International Association of Insurance
2007 Optional Federal Charter
(OFC), and Non-admitted Supervisors, where the CEA is an observer.
and Reinsurance Reform
Act (NRRA)
REO proposal significantly Positive state actions
revised, with functions
split between Reinsurance On 18 October 2007, New York published a
September ‘07 Supervision Review
Department (RSRD) and radically revised draft credit-for-reinsurance
“port of entry state” for regulation, which would help towards
certification
achieving a level playing field for EU and
NAIC releases “Framework
Memorandum” outlining New York reinsurers. Florida published a new
November ‘07
proposal and long list of credit-for-reinsurance law in January 2007
“unresolved issues”
Framework adopted with and proposed regulations were passed by
December ‘07 amendments at NAIC the Florida Cabinet on 18 December 2007,
Winter Meeting
mirroring the funding requirements of the
US Treasury produces report
on US regulatory efficiency New York proposal by requiring collateral
March ‘08
because of concerns that on a sliding scale calibrated to financial
US lags behind Europe
NAIC adopts Reinsurance strength. Reforms in individual states are,
March ‘08 Regulatory Modernisation however, of limited value unless a consistent
Framework
model emerges as a precedent that could be
US Treasury recommends
April ‘08 adopted at federal level.
OFC for insurers

20
Single Market Review
A clear focus on customer satisfaction
The CEA welcomes the single market review’s focus on the needs of the
consumer. It believes that consumers should experience concrete benefits from an
integrated European insurance market.
The EC has engaged in a wide-ranging review
of the operations of the European Union as a
single market. This has focused in particular
on retail financial services, where a lack of
cross-border activity has been identified, due
to existing barriers.
In its review, the EC has taken into account
contributions to the consultation launched
by the Green Paper on Retail Financial
Services in May 2007. The CEA submitted its
contributions together with a series of policy
recommendations aimed at removing the
remaining regulatory obstacles to further
retail insurance market integration.
The CEA highlighted the diversity of national
regulations (eg taxation, liability or social security
legislation and legal systems concerning natural
catastrophes) which hinders the development of
cross-border business in the insurance sector.
On retail insurance, the CEA however also
drew attention to the fact that consumers still
predominantly prefer to buy their insurance
policies locally (see box right). “Natural”
barriers, to cross-border activity, such as the
need for “after-sales services” facilitated
by proximity between the consumer and
the insurer, as well as language barriers,
frequently explain this preference. In addition,
expert knowledge of risk exposures (smoking
habits, driver habits, climate, etc) is necessary
in order to design appropriate insurance
products. These practical considerations
might contribute to the fact that insurers
CEA Annual Report 2007–2008
offer products in other countries through a
permanent branch or subsidiary.
Building on these findings and on other studies
launched in 2006, the EC has identified areas
in which to improve the competitiveness and
Customer satisfaction
A survey carried out by Ipsos for the EC
in May 2007, based on 29 000 interviews
of consumers in the then 25 EU Member
States, found:
• Insurance services were the second
best rated product out of 11 (electricity
& gas supply, water distribution, fixed/
mobile phone, urban/extra-urban and
air transport, postal services, retail
banking).
• A very high level of customer loyalty
to insurers (87%). Consumers tended
to stay with their insurer and had no
intention of changing in the short term.
This is particularly interesting given that
77% of EU consumers believed that it
was easy to change insurer.
• Consumers believed that there was
enough competition in the insurance
field (88%).
• Only a limited percentage (37%)
thought it possible to purchase services
from an insurer outside their country.
• Consumers were not ready to do so,
since a huge majority (83%) preferred
national insurers.
CEA Annual Report 2007–2008
efficiency of European retail financial services
markets. At the end of 2007 it adopted a
“Communication on a single market for the
21st century Europe” and other working
documents with concrete proposals for retail
financial services initiatives.
The main aims of this Single Market Review are
to deliver benefits for citizens, consumers and
small and medium-sized enterprises; to take
better advantage of globalisation; to open
frontiers of knowledge and innovation and
to promote a strong social and environmental
dimension. The so-called “review package”
is not an extensive legislative programme,
but one that aims to remove existing barriers
by using different instruments (legislation,
soft law, voluntary codes) and improved
information to consumers.
Focus on motor
Several initiatives relate directly or indirectly
to the insurance sector. On motor insurance
premiums, for example, the EC is seeking a
better understanding of what discourages
insurers from providing motor insurance
on a cross-border basis and/or by setting up
branches. The CEA has published a detailed
statistical report that highlights the complexity
of this market (see p23). The report also
explains in detail the differences in the national
legal and economic context that are the main
factors behind divergent motor insurance
premiums across the EU. On the surface, motor
insurance may look the same to policyholders
across Europe, but premium levels reflect the
national environment. Decisive factors that
determine this variation across Member States
are the frequency of claims, the average claims
costs, the taxes imposed on premiums and
the road safety conditions in the Member
States. Since the price disparities reflect local
21
specificities, a standardised approach to pricing
remains difficult.
For example, there are differences in the
impact of road accidents. In Germany there
are on average 13.7 hospitalisations for each
road fatality, while in Portugal this figure is
3.7. As a consequence, the bodily injury share
of claims varies from country to country,
ranging from 6% to 35%.
Other initiatives
Other initiatives in retail financial services
include promoting financial literacy, actions
to allow consumers to move freely between
providers, promoting the EU mortgage credit
market and developing alternative redress
mechanisms.
Transparency and the distribution requirements
of “competing” retail investment products
(see p16) will also be examined in-depth.
Regarding financial literacy, the CEA has
produced a brochure on “Financial awareness
initiatives promoted by the European insurance
industry”. The CEA also contributes directly
to the promotion of best practices among its
members and others in the insurance field.
The CEA’s financial
awareness initiatives
brochure is available
to download free
FFSA — promoting financial literacy on the CEA website,
www.cea.eu
Through a dedicated documentation
centre on its website (CDIA, or Centre
de Documentation et d’Information de
l’Assurance), the French insurance
federation, FFSA, provides information
for both individuals and companies on
a host of insurance topics. Its aim is to
increase financial awareness among
consumers to allow them to take
appropriate decisions when investing
their money in financial products.
 CEA Annual Report 2007–2008

22

New methodology an increased EC focus on the customer.

The survey commissioned by the EC in May
The EC has also announced a new
2007 (see box on p20) clearly showed a high
methodology for a systematic monitoring of
level of customer satisfaction with insurance
the functioning of markets by introducing
services.
sector enquiries and launching a “consumer
scoreboard”. The EC wants to step up its efforts to ensure
the appropriate and timely implementation
The consumer scoreboard aims to show the
of EU legislation and announced that
performance of markets in terms of economic
priority will be given to infringements. It
and social outcomes, using indicators such as
will also systematically publish information
prices, complaints and consumer satisfaction,
on the current state of implementation of
along with new data sources such as the
EU legislation, including infringements. The
comparison of consumer prices.
Single Market Review will be followed up in
This scoreboard will probably be integrated the Lisbon Strategy.
into the Single Market Scoreboard from 2009
onwards. The EC is also strengthening its
focus on consumers’ opinions with the use
of consumer focus groups to complement
the views it receives from consumer
organisations.

The CEA and its members strive to ensure that

customers are satisfied with the insurance
products available and are pleased to support

Social services of general interest

Services of general interest are services that are essential for the daily life of citizens and
enterprises. They range from energy, telecommunications, transport, broadcasting and
postal services, to education, water supply, waste management and health and social
services.

The CEA wrote to the EC in November 2007 to express its concern that (supplementary)
funded systems in the areas of occupational and private pensions, health and accident
insurance and unemployment insurance could be exempt from the competition rules set
out by the EU.

In these market segments of private insurance, competition already delivers choice and
affordability for consumers. Moreover, these activities are subject to a comprehensive
regulatory and prudential framework as stipulated in the EU insurance acquis.

The aim of the acquis is to build the internal market by providing a regulatory regime
applicable to all insurance providers. Exemptions for social services of general interest
would go against the principle of fair competition.
CEA Annual Report 2007–2008
European motor insurance
Why motor insurance premiums are a complex matter
The CEA’s work needs to focus on personal
injury claims – not only in the motor insurance market, but across
various business lines.
With the enlargement of the EU and the
Schengen area, Europe’s border-free zone, the
mobility of individuals in the EU has grown
steadily. More and more professionals move
abroad when their own national market does
not offer them attractive job opportunities.
One of their first administrative hurdles in the
new country of residence is the registration
of their vehicle and the change of motor
third party liability insurance (MTPL). When
choosing a new MTPL policy, they soon
discover that there are price differences
between EU Member States.
Case study: Italy — road safety
A high number of accidents occur among
young drivers aged 14 to 25 years.
Newly licensed young drivers are involved
in 40% of all accidents.
“Ania Campus & Patentino online” is:
• organised by the Fondazione per la
Sicurezza Stradale, created by Ania,
the Italian insurance association
• focuses on young drivers on “two
wheelers”
• offers safe-driving tests on two wheels
and an e-learning platform
• has a steadily growing number of
participants
23
How are premiums calculated?
Insurers base motor premiums on a detailed
analysis of their own statistics from previous
business years and estimated future
developments. Two of the main factors are
the likelihood of a claim being submitted to
the MTPL insurer (claims frequency) and the
estimated average cost per claim (claims costs).
Claims frequency
The likelihood of being involved in an accident
and a claim being submitted to the MTPL The statistical
insurer largely depends on: report by the CEA,
“The European Motor
Insurance Market”,
• Traffic conditions published in December
A policyholder, who drives an hour to work 2007, is available to
download free on
every day in an urban area is more likely to the CEA website,
www.cea.eu
have an accident than a policyholder who lives
in the countryside and uses his car only once
a week at the weekend for a short distance.
• Driving habits
The likelihood of having an accident also
largely depends on driving behaviour in each
country. Drink driving, speeding, not stopping
at a red light and not wearing a seatbelt are
still the traffic offences that lead to high rates
of road fatalities.
• Road safety
Since the road fatality rate among young
drivers is almost two to three times higher
than among average drivers, the EC asked
all Member States, which have committed
themselves to reducing the number of road
 CEA Annual Report 2007–2008

24

fatalities by 50% by 2010, to focus their road
safety measures on young drivers.
Young drivers are characterised by their lack
of road experience, their higher inclination
to take risks and their attraction to high-
powered vehicles. They also usually carry
more passengers in their cars than other age
groups. As a consequence, the number of
injured persons is relatively higher.
The insurance industry, together with other
road safety organisations, has therefore
widened the scope of its road safety measures
to target young drivers.
• Fraud
Insurance fraud exists in all Member States.
The percentage of fraudulent claims varies
not only from state to state, but from region
to region.
The Italian Insurance Association (Ania) has
found a significant correlation between claims
frequency and the percentage of fraudulent
claims. The southern region of Campagnia, for
example, shows the highest claims frequency
at 11.64% and also the highest percentage
of fraudulent claims at 8.39%. The same
correlation between claims frequency was
found in the northern region of Liguria. Since
the number of fraudulent claims has a direct
impact on claims frequency and on claims
costs, the insurance industry is determined to
fight insurance fraud.
Claims costs
Claims costs mainly consist of repair costs, the
cost of spare parts, costs for personal injury
and legal costs.
• Repair costs & spare parts
While the price of spare parts has remained
relatively moderate, repair costs have
grown by an average of 3.5% over the last
10 years across the EU and vary significantly
between Member States.
• Bodily injuries & legal costs
The amount of compensation paid for bodily
injuries generally depends on national law
and the national jurisdiction regarding the
different injuries.
In addition, living standards and medical costs
in the relevant Member State have a decisive
influence on the damages awarded.

Case study: UK — insurance fraud

Research by the Association of British Insurers (ABI) shows:

• an annual cost of insurance fraud of £1.6bn (€2.0bn)

• one in ten adults admits to having committed insurance fraud
• a rise in the average premium of £40 (€51bn) due to the cost of
fraud
The British insurance industry and the police launched the Insurance
Fraud Bureau (IFB) in July 2006 to detect fraudulent claims and
fight fraudulent activity effectively.
CEA Annual Report 2007–2008
Case study: Germany —
claims costs for private cars by region
Source: GDV, the German insurance association
An index of motor third part liability (MTPL)
claims costs is calculated per region based
on local data. The darker the colour, the
higher the claims index and thus the higher
the premium. The factors explaining the
regional differences include:
• traffic density (far higher in urban areas
such as Berlin and Munich)
• economic development (eg the claims
index is lower in eastern Germany)
• terrain (eg the claims index is higher in
the mountainous south)
A cost that is often underestimated is legal
costs. Victims who have suffered an injury
in an accident often pursue their claim for
compensation with the help of a lawyer.
Though the majority of personal injury
claims are settled out of court, the legal
costs still represent a significant share of the
compensation paid in some Member States
like the UK.
25
The CEA and its members have therefore
been working and continue to work on claims
settlement procedures that allow for quick and
fair settlement.
The EC is currently analysing the compensation
paid for personal injuries in cross-border cases
in order to determine whether there is room
for improvement. The CEA is committed to
contributing to the discussions with the aim of
safeguarding the effective and quick settlement
of cross-border claims.
Differences in motor insurance premiums
can largely be explained by a variety of
different local/regional factors, which cannot
be influenced by the insurance industry.
The insurance industry has, however, taken
numerous measures to reduce claims
frequency and claims costs that have a direct
impact on insurance premiums.
Case study: Austria — repair costs
In 2006 the Austrian motor insurance
industry noted:
• an increase of 3.22% in repair costs
— more than 1.22% above the
inflation rate
• an increase in hourly labour costs of
5.17% to €101
Measures taken to reduce repair costs:
• the use of alternative, cost-saving
repair methods
• electronic communication with repair
shops

26
IFRS 4 Phase II
New accounting standards for Europe
Last year there was tremendous momentum in the European insurance
industry to comment on what IFRS should be for insurance and on its links with
Solvency II. We need to maintain this momentum.
Since 2005, all European listed companies
have been required to prepare their
consolidated financial statements under
International Financial Reporting Standards
(IFRS). Those standards are developed by the
International Accounting Standards Board
(IASB).
However, there is currently no proper IFRS for
valuing insurance contracts in the financial
statements of insurance companies. Indeed,
the current standard introduced in 2004,
IFRS 4, is only an interim standard to enable
European insurers to be IFRS-compliant
for their consolidated accounts. Though
considered a necessary first step, IFRS 4 has
not been deemed an acceptable long-term
solution.
Three building blocks
In May 2007, the IASB issued a first proposal
of a final standard, the Insurance Contract
Discussion Paper. This standard, IFRS 4
Phase II, aims to introduce significant changes
in the fundamental valuation of liabilities
in insurance contracts. The single model
proposed for both life and non-life products
is based on three building blocks: the
prospective approach of future cash in- and
outflows generated by a contract (the “best
estimate”); the discounting of cash flows for
the time value of money; and a margin for
risk and uncertainties.
Each building block raises concerns or
CEA Annual Report 2007–2008
questions. For the first, the IASB has
tentatively preferred a legalistic approach to
separate the cash flows to be included or
excluded. For example, future premiums such
as renewal premiums or recurring premiums
are only taken into account if they meet the
concept of guaranteed insurability. Broadly,
this means taking into account future
premiums only if the policyholder has an
economic interest in paying them, regardless
of whether it is beneficial or not for the
insurers. Another example is the discretionary
bonuses that insurance companies often pay
to policyholders. At this stage, those bonuses
would only be recognised as insurance
provisions if they are legally enforceable.
The second block aims to take into account
the time value of money for both life and
non-life reserves. The discount rate should
be an observable market-risk-free rate and
should not be linked to the return on assets
held by the insurer.
Finally, the third block is the risk and service
margins. The IASB proposes to calculate the
risk margin as being the margin that a third
party would require to assume the insurance
liability from the initial insurer (current
exit value). The discussion paper considers
alternative approaches, such as calibrating
the reserve on the premium charged, but
tentatively concludes that the current exit
value would provide more useful information
for users of financial statements. As for the
service margin, though the concept is unclear
CEA Annual Report 2007–2008
it is understood to be the margin that a third
party would require to provide services other
than the insurance risk cover (ie investment
management for certain life contracts).
The choice of the current exit value raises
several questions:
• Is the objective of transfer value relevant
in a world where few transfers occur?
• Does the current exit value prevent insurers
from using their own assumptions when
determining cash flows (the first building
block)?
• Should the insurance liabilities include any
benefit from portfolio diversification?
These questions are still to be considered by
the IASB and key stakeholders. However, for
insurers it is clear that for certain non-financial
assumptions (ie expenses) where there is no
observable market it is less arbitrary and more
relevant to use their own assumptions when
calculating insurance liabilities. Insurers also
believe that diversification across portfolios
should be allowed for when measuring
insurance liabilities. The calibration of the risk
margin is extremely important for insurers as
it has a direct impact on the pace at which
profits are reported (eg the question of profit
at inception).
On many key topics (unbundling, future
premiums, participating contracts, etc) the
insurance industry is unified worldwide.
However, on other important topics such
as the single measurement model or which
discount rate to use, US insurers have views
that are not in line with the approach
supported by European insurers.
Uncertain future?
In November 2007, the CEA and the CFO
Forum issued a joint comment letter in
response to the discussion paper, setting
27
out the initial views of European insurers.
The IASB is expected to issue its second (and
final) consultation document, an exposure
draft, in late 2009 at the earliest, giving
the insurance industry another opportunity
to voice its views and in the meantime
actively to contribute to the design of the
draft, in particular the notion of transfer
and settlement value. However, the IASB is
currently reviewing its timetable in the light
of its work with the US standards setter,
the Financial Accounting Standards Board
(FASB). It is unclear at this stage whether
the insurance project will advance as
announced.
Finally, IFRS 4 Phase II is currently being
developed on a similar timetable to the new
regulatory regime for European insurers,
Solvency II. Solvency II and IFRS 4 Phase II
are both based on an economic valuation of
insurance liabilities, so it makes sense for the
two to converge as much as possible and any
potential divergence needs to be carefully
explained. The CEA’s positions in its IFRS 4
Phase II comment letter were developed in
light of its positions on Solvency II.
Other IASB projects
Many of the issues raised by IFRS 4 Phase II
could have an impact on other industries.
The possibility of taking customers’ future
behaviour (ie renewals) into account when
valuing contracts is one example.
There are also currently other significant
areas of work at the IASB that interact
with the insurance project. In particular,
the IASB is developing discussion papers
on revenue recognition, the presentation
of financial statements and fair-value
measurement.

28
EC inquiry into competition issues
Maintaining a competitive business insurance market
The EC’s 2007 report on business insurance put the subscription market and the insurance
Block Exemption Regulation (BER) in the spotlight and marked the beginning of intense
efforts to better explain their benefits to Europe’s society and economy.
In mid-2005 the EC’s Directorate General
for Competition launched an inquiry into
business insurance. It published its interim
report in January 2007. The CEA commented
extensively on the findings and, in April 2007,
submitted ten policy recommendations. On
25 September 2007, the EC published its
final report. Its main findings cover long-term
contracts, profitability, premium alignment
practice in the subscription market and
horizontal cooperation, ie the insurance Block
Exemption Regulation (BER).
The CEA noted that the EC overstated the
profitability of the business insurance sector
in its preliminary report. The CEA therefore
recommended the use of an indicator such
as return on equity or cost of capital to
allow comparison between business lines
and countries that takes into account both
investment income and the level of capital
required, as well as the use of a longer
timeframe to adequately recognise the cyclical
pattern of insurance activity.
While it acknowledged the validity of certain
CEA criticisms, the EC maintained in its
final report that profitability was quite high
in EU business insurance, and that it varied
significantly depending on business lines,
Member States and whether customers were
small companies or large corporations.
The EC observed a widespread practice in
co-(re)insurance markets resulting de facto
in an alignment of premiums and other
CEA Annual Report 2007–2008
Bipar principles
The CEA formally endorsed the high level
principles for placement of a risk with
multiple insurers that were published by
the European Federation of Insurance
Intermediaries (Bipar) in April 2008.
These principles aim to provide security
for clients by setting a framework to
facilitate the placement of business risks
by brokers with multiple insurers. They
make firm proposals on how the client
should be given the opportunity to make
an informed choice on how best to
complete the coverage of the risk, based
on the broker’s advice.
The EC will monitor the practical
implementation of these principles and,
if competition concerns remain, will make
use of its enforcement powers.
conditions of coverage. According to the
EC, certain of those individual practices,
when resulting from agreements between
undertakings, may not satisfy all the criteria
for exemption from EU competition law.
The EC made clear that it has no objections
to the concept of co-insurance itself, but that
it was concerned about the automatic (or so
perceived) practice of premium alignment
by the following market on the basis of the
tariff quoted by the lead insurer. The EC
recommended that the industry “engage in
CEA Annual Report 2007–2008

29

a critical reappraisal of the said practices”. In
mid-February 2008, the CEA highlighted to
the EC the highly competitive environment for
subscription placement and stressed that the
premium alignment strategy, while clearly not
obligatory, may present for all parties, including
the customer, the most advantageous way to
place risks in certain circumstances.
In parallel, the CEA joined the initiative of the
European Federation of Insurance Intermediaries
(Bipar) to develop a series of high level principles
for placement of a risk with multiple insurers (see
box left).
BER benefits
In its final report, the EC recognised the need
for the forms of cooperation (joint calculation,
standard policy conditions, pools and security
devices) covered by the BER, but called into
question the need to renew it beyond its 2010
deadline. The EC considers that operators have
enough experience to assess whether their
behaviour conforms with antitrust legislation
without the benefit of the BER.
The EC’s final decision on the future of the BER
will be based in particular on the outcome of
a consultation document published in April
2008. The CEA is taking part in the consultation
process, which ends in July 2008.
The CEA believes that the full benefits of the
BER for market integration and ultimately
consumers should be given sufficient
weight.
On several occasions the CEA has
demonstrated that the BER has proven
beneficial to competition. It leads to the
opening of markets to new players and small
and medium-sized insurance undertakings,
thus enhancing the variety of products
available to consumers.
The BER also facilitates insurability of risks
and provides the legal certainty necessary for
market efficiency and stability. Were the BER
to be abolished, some insurers might abandon
positive business cooperation for fear that it
is afterwards challenged by the competition
authorities.

What is the BER?

The Block Exemption Regulation for the insurance sector covers agreements between
insurance companies that are exempt from EU competition law.

The BER allows, for example, the collection and dissemination of market claims data. This
enables both large and small insurers to set more competitive premium levels because their
calculations are based on a wider and more representative sample of data than they would
be able to collect themselves and it also makes it easier fo insurers to enter new markets, thus
increasing competition.

The BER makes it possible for insurers to jointly establish and distribute standard policy
conditions. In the case of industrial property insurance, for example, standard policy
conditions are normally drafted to provide average protection. Contracting parties then
take these conditions as a starting point and the outcome is usually a contract accurately
tailored to the client’s needs. The BER also enables the co-insurance of large risks, for which
adequate capacity might otherwise be unavailable.

The current insurance BER is due to expire on 31 March 2010.

 CEA Annual Report 2007–2008

30.
30

VAT — Insurance and Financial Services Review

Towards a modernised taxation system
The updated taxation rules in the review are a
first step towards a European level playing field and an opportunity
to reduce hidden VAT.

As part of its drive to update and simplify

taxation rules for insurance and financial
services, the EC presented a proposed
amendment to the existing EU Value Added
Tax (VAT) legislation in November 2007,
seeking to introduce a new modernised
system for insurance and financial services at
EU level.
The present: what is wrong?
Problem 1: Uncertainty over exemption
The VAT Directive, which exempts financial
services and insurance from VAT, dates
from 1977 and has not been revised since.
In contrast, the insurance and financial
services market has changed dramatically,
with increased global competition driving
economies of scale and improved efficiency.
In particular, there is far more outsourcing in
insurance and financial markets, so insurers
frequently deal with companies which would
not normally be considered to be financial or
insurance institutions.
The exemption for insurers in article 135/1(a)
of the VAT Directive refers exclusively to
insurance and to “related services performed
by insurance brokers and insurance agents”.
This make the identity of the supplier
fundamental to the exemption of the
outsourced service.
This exemption, which is not applied
uniformly by Member States, and the
changes to insurance business structures has
Timetable
November 2007 — draft Directive on VAT
on insurance and financial services issued
by the EC
March 2008 — position paper issued by
the CEA
November 2007 onwards — European
Parliament and European Council consider
the proposals. Parliament to issue a non-
binding opinion. Unanimous vote of the
Council required for adoption of the
Directive
31 December 2009 — date by which
it is envisaged the Directive should be
transposed by EU Member States
meant that the European Court of Justice (ECJ)
has frequently been required to interpret the
VAT legislation (including landmark decisions
such as C-08/01 Taksatorrigen and C-472/03
Andersen). Since the outcome of the growing
list of ECJ decisions is unpredictable, this has
created uncertainty.
Problem 2: Lack of neutrality —
recovering VAT
Under the VAT system, insurance and financial
companies do not tax the services they supply.
As a result, they are generally prevented from
recovering the VAT they pay on the goods
and services they purchase to carry out their
activities.
CEA Annual Report 2007–2008
This input VAT therefore becomes a
cost to companies and decreases their
competitiveness, in open contradiction of
one of the basic features of VAT, namely
neutrality for business operators in the
supply chain.
The future: what will change with the
VAT — Insurance and Financial Services
Review?
The VAT — Insurance and Financial Services
Review consists of:
• an amendment to the existing VAT Directive
to increase legal certainty both for the
business sector and tax authorities and to
tackle the issue of non-recoverable VAT
• a new Regulation which expands the
definitions of exempt services and will
apply directly in all Member States
The review also provides insurance and
financial operators with two instruments
for reducing the negative impact of non-
deductible VAT: the option to tax their
services if they wish; and an industry-specific
exemption from VAT on groups’ cost-sharing
arrangements, including those that are cross-
border, to enable institutions to pool their
operations and share costs between group
members without creating additional non-
recoverable VAT.
The CEA welcomes the VAT — Insurance and
Financial Services Review and, with the support
of its members, fully engaged in the EC’s
consultation process during the months that
preceded the presentation of the proposals
in the review. Several meetings on the key
issues were held with all interested parties at
the EC.
The CEA is broadly satisfied with the
31
Insurance definition
This is the first time that an EC draft
Directive has attempted to define
insurance activities. The definition (Article
135a*) reads:
“’insurance and reinsurance’ means a
commitment whereby a person is obliged,
in return for a payment, to provide another
person, in the event of materialisation of
a risk, with an indemnity or a benefit as
determined by the commitment”.
*Council Directive 2006/112/EC of 28 November
2006 on the common system of value added tax
proposals as they currently stand. They
largely take on board the concerns the CEA
expressed over the definition of insurance
and insurance-related services.
Nevertheless, interpretation of the review’s
proposals is not straightforward. Europe’s
insurers still have concerns over the
interpretation of the VAT Directive and VAT
Regulation. The CEA has therefore already
made public in a position paper its belief that
some of the proposed wording still needs to
be debated and clarified, so that the legal
certainty and systematic approach promised
by the review can be delivered.

32
Compulsory liability
The new EU policy perspective
Liability insurance is increasingly seen by the political community as a tool for consumer
protection. The insurance industry is always willing to discuss how it can support EU policy
objectives and dialogue is essential to ensure that any mandatory schemes are feasible.
The EU’s Lisbon Treaty of December 2007
focuses on ensuring that the EU’s internal
market functions well. As a result, the new
policy vision for the single market is a greater
focus on the needs of consumers and small
businesses.
This means that competitive retail insurance
markets, including liability insurance, will
have to offer maximum choice and the best
quality products at the lowest price. Where
the introduction of mandatory liability
Case study: Construction
In the late 1980s, the EU identified a need
for action to eliminate the distortions
arising from differing regulations and to
harmonise the rules governing liability.
A group of European professional and
trade associations for the construction
industry (Gaipec) was set up to assist the
EC in drawing up a proposal for a Directive
on liabilities and guarantees. Broad
agreement was reached on most topics,
except the liabilities and guarantees that
differed too widely from one Member
State to another. In 2007 the EC took
up this subject again. Learning from
the past, it is not intending to further
harmonise liability rules and insurance
schemes throughout Europe. Instead it is
adopting a pragmatic approach in which
relevant stakeholders will assist the EU in
identifying good practices.
CEA Annual Report 2007–2008
insurance schemes is being considered, the
CEA believes that a pragmatic and economic
approach must be adopted. The CEA would
like to ensure that any compulsory schemes
that are introduced are well balanced;
reconciling all economic and social interests
so that there are no market failures and no
adverse effects on the good functioning of
the internal market.
The EU’s treaties do not explicitly empower
the EC to regulate liability. In the absence of
such provisions, EC rules related to liability,
when available, are sector-specific, covering
areas such as public health, the environment,
agriculture and transport.
Over recent decades there has been a trend
towards the introduction of mandatory
insurance cover in various areas, such as the
environment, public health and food safety.
This is because such schemes are perceived by
the European institutions to be a consumer
protection measure providing sweeping
protection/compensation against possible
failure from the liable party, while at the
same time reducing the burden on the public
purse.
Compulsory not always efficient
Yet, mandatory liability insurance is not
always an efficient tool to protect consumers.
A poorly designed scheme provides little
comfort to consumers, forcing them into a
national liability system, with time-consuming,
CEA Annual Report 2007–2008

33

expensive and uncertain claims that take development on a voluntary basis of a

years to settle. The issue is complex, and
macro-economic and social considerations
have to be addressed before any EU-wide
mandatory liability insurance should be
proposed. Stricter liability regimes always
involve social costs and make the supply of
products and services more expensive. The
costs of poorly designed compulsory schemes
are ultimately borne by consumers.
Except in a limited number of areas, such as
third party motor liability insurance or liability
insurance for air carriers, there are significant
differences in this area between EU Member
States. If the functioning of national
insurance markets and compensation
schemes is not to be adversely affected when
there is intervention at EU level, there needs
to be a robust public policy rationale, well
understood and accepted by the general
public and prospective policyholders. That
intervention might be required in instances
where conceivable losses are so great that
it would be unacceptable to rely on the
commercial insurance market (eg nuclear
risks). Costs and benefits must be carefully
weighed against each other for a well
balanced compulsory liability insurance
scheme.
Key requirements
The key prerequisites for setting up
mandatory liability insurance schemes in
Europe are:
• an established and sustainable liability
insurance market: readily transferable
expertise, experience and knowledge,
together with sufficient capital and other
The CEA’s
capacity, eg skills;
environmental liability
• a plentiful supply of capacity and publication is available
adequate limits; to download free of
charge on its website,
• competition: choice of products and www.cea.eu
insurers;
• cover available to all buyers; and,
• demonstrable compliance with the latest
solvency regulations.

Case study: Environmental

impairment

The EC’s Environmental Liability Directive

(ELD) of 2004 implements at EU level the
“polluter pays” principle. In it, market-led
insurance solutions are seen as key.

The CEA environmental expert working

group issued a report in February 2008
entitled “The Environmental Liability
Directive: Enhancing Sustainable Insurance
Solutions”. It set out the cornerstones of
underwriting, risk assessment and claims
handling needed to allow the development
of innovative insurance products for
environmental damage.
 CEA Annual Report 2007–2008

34

Social dialogue
Improving industrial relations in insurance
The CEA is back on the European social scene, ready to engage
in a fruitful social dialogue with its partners in the insurance sector for the benefits of
European workers and employers alike.

After a three-year suspension, the Insurance project will further develop the exchange of
Sectoral Social Dialogue Committee (ISSDC) (see experiences and facilitate networking.
box) relaunched its activities in September 2007.
Demographic challenges
The members issued the “Declaration of the
European social partners on the social dialogue Another topic identified for the ISSDC in 2008
on insurance”, summarising its aims and setting is the challenge of demographic change,
out a series of themes for discussion. focusing mainly on the problems that the
changing age structure of populations
Seminars in new Member States
presents for the insurance sector.
The ISSDC agreed on a comprehensive work
Other areas that may be examined in the near
programme for 2007-2008. One item is
future are the attractiveness of the insurance
to facilitate the integration of the new EU
sector; life-long learning and training;
Member States into European social dialogue
retention of older staff and recruitment of
in the insurance sector. To achieve this, the
new staff members; work-related stress;
EC is funding two seminars, organised by
corporate social responsibility; and work/
the social partners, for representatives of
family balance.
employers and employees in new Member
States.
A history of dialogue
The first one, aimed at the Czech Republic
The CEA has been engaged in social
and Slovakia, took place in Prague on 31
dialogue in the insurance sector for
March–1 April 2008. It stimulated a positive
more than 20 years. It participated in an
and lively exchange of views on the existing
informal working party from 1987 and
collective bargaining structure at both sectoral
it joined the Insurance Sectoral Social
and company level and on ways to improve
Dialogue Committee (ISSDC) after it was
the structure for social dialogue. The second
established in 1999.
seminar will be held in Budapest.
Employers’ representatives in the ISSDC
The objective of these seminars is to familiarise
are the CEA, Amice (Association of Mutual
the social partners in the new and old Member
Insurer and Insurance cooperatives in
States with each other’s industrial relations,
Europe) and Bipar (European Federation
and to integrate the new states into the
of Insurance Intermediaries) and the
European social dialogue structures. A two-
employee representative is UNI-Europa,
day conference in Brussels will draw together
the federation of European trade unions.
the results of the seminars and a follow-up
The CEA

CEA
I ns ur e r s of E ur o pe
 CEA Annual Report 2007–2008

36

CEA events 2007–2008

GENERAL ASSEMBLY on key issues for insurers: Solvency II,

15 June 2007 demographic challenges, social security, and
fraud and data protection.
The CEA’s 2007 General Assembly was
held in Stockholm, hosted by the Swedish General Assembly attendees also enjoyed a
federation, Sveriges Försäkringsförbund. gala dinner in Stockholm’s City Hall, at which
a traditional Nobel Prize Award Ceremony
A conference addressing how the insurance
dinner was served.
industry can help to deliver solutions to a
range of new and emerging risks followed
the General Assembly meeting. Sweden’s
Minister for the
Environment,
Andreas
Carlgren, made
the keynote
speech. Other
speakers
included
Professor Dr
Peter Höppe of
CEA president Gérard de
Munich Re on La Martinière with (right) Sweden’s
Minister for the Environment,
climate change
Torbjörn Magnusson, chairman of the board of Andreas Carlgren
and Professor the Swedish Insurance Federation
Angus Nicoll of
the European Centre for Disease Prevention
and Control on pandemics.

The day before the

General Assembly,
the CEA held four
individual workshops
Professor Dr Peter
Höppe during his speech
at the conference on
new and emerging risks The CEA’s General Assembly statutory meeting
CEA Annual Report 2007–2008
CONFERENCE
Solvency II: A window of opportunity
for European consumers and industry
6 March 2008
More than 200 delegates packed the
conference hall of the Permanent
Representation of the Free State of Bavaria to
the EU in Brussels to hear keynote speeches
and panel debates on the key issues of the
EU Commissioner Charlie McCreevy gives his
keynote speech at the Solvency II conference
Solvency II project. Charlie McCreevy, European
Commissioner for Internal Market and Services,
and Mick McAteer, member of the consultative
panel of the Committee of Insurance and
Occupational Pensions Supervisors, gave the
keynote speeches, which were followed by
two lively panel discussions on issues affecting
small and medium-sized enterprises and on
group supervision. CEA also hosted its annual
cocktail reception at the same venue the night
before the conference.
CEA president Gérard de La Martinière, CEA
director general Michaela Koller and John Purvis MEP
at the annual cocktail reception
37
WORKSHOP
The Environmental Liability
Directive: Enhancing sustainable
insurance solutions
13 February 2008
Following a successful workshop in
January 2007, the CEA held its second
environmental liability workshop in
Brussels in February 2008 to launch
a report entitled “The Environmental
Liability Directive: Enhancing sustainable
insurance solutions”.
The workshop was attended by around
130 key stakeholders, including Member
State transposition authorities, national
insurance associations, European
Commission officials, insurance
providers and brokers. The report
and the workshop aimed to stimulate
discussion of the EC’s Environmental
Liability Directive and to highlight
areas in which insurers might provide
affordable risk transfer solutions in this
new field of sustainable development
and environmental protection.
Peter Skinner MEP contributes to the
Solvency II panel debate, watched by Klaas Knot of
the Ceiops managing board and Elemér Terták of the
European Commission
 CEA Annual Report 2007–2008

38

CEA publications 2007–2008

Annual Report Solvency II – Main Results of Solvency II Briefing Note 1:

2006–2007 CEA’s Impact Assessment Diversification
(June 2007) (June 2007) and Specialisation
(June 2007)

Solvency II Briefing Note 2:
The Insurance Groups and
Solvency II
(June 2007 )
Solvency II Briefing Note 3:
The Small and Medium-Sized
Undertakings and Solvency II
(June 2007 )
Reducing the Social and
Economic Impact of Climate
Change and Natural
Catastrophes
(June 2007 )

Briefing Note: European Insurance The Role of Insurance in

Adapting to Climate Change in Figures (2006 data) the Provision of Pension
(June 2007 ) (August 2007) Revenue
(September 2007)
CEA Annual Report 2007–2008

39 39

Solvency II Briefing Note 4: The European Motor Solvency II: How the Group
Why it Matters to Consumers Insurance Market Support Regime works in
(November 2007) (December 2007) practice (Case Studies)
(February 2008)

Solvency II: FAQs on The Environmental Tax Treatment of 2nd

Group Supervision & Liability Directive: and 3rd Pillar Pension
Group Support Regime Enhancing Sustainable Products 2008
(February 2008) Insurance Solutions (March 2008)
(February 2008)

All CEA publications are available to download

free of charge from the CEA website:
www.cea.eu

Indirect Taxation on
Insurance Contracts in
Europe 2008
(March 2008)
 CEA Annual Report 2007–2008

40

2007–2008 — a year of revitalisation at the CEA

Since the last Annual Report, the CEA has
undergone a major transformation. The
federation is now entirely Brussels-based, close
to the major European decision-makers, and
has rapidly re-established its former strength.
Its strengthened workforce is now in a position
to lobby efficiently and effectively on behalf
of its members — the national associations —
on the many EU projects currently underway
that concern Europe’s (re)insurers.
Changes to the CEA’s governance have put
increased emphasis on active and efficient
representation of its member associations’
interests and has thus created a strong platform
for coordinated and complementary lobbying
activity by the CEA and its members.
achieving results. A transparent procedure for
nominating committee chairpersons has also
been drawn up, and new chairpersons will
take up their positions in the second half of
2008.
The reshaping of the CEA has had the full
support of its members and throughout the
reorganisation the CEA has remained effective
in representing the European (re)insurance
industry to all the key European institutions.
CEA president Gérard
de La Martinière has
overseen the CEA
restructuring

The CEA has also undertaken a full review of

its committees; the groups that shape and
drive the CEA’s activities. It has created a
leaner, more streamlined committee structure
that enables committee members and the CEA
Incoming president
secretariat to focus firmly on key activities and Tommy Persson of
Länsförsäkringar

Three associate members have

become full CEA members in the past
The term of office of CEA president Gérard de
year. Following the accession of Bulgaria
La Martinière was extended by a year to ensure
and Romania to the EU on 1 January 2007,
continuity throughout the reorganisation. His
the Bulgarian national association
extended term comes to an end at the CEA’s
(ABZ) and the National Association of
General Assembly in Berlin in June 2008 when
Insurance and Reinsurance Companies
Tommy Persson, currently CEO of Sweden’s
from Romania (Unsar) have become full
Länsförsäkringar, will take over as president,
members, as has the Croatian Insurance
bringing the perspective of a medium-sized
Bureau.
Nordic mutual to the leadership of the CEA.
CEA Annual Report 2007–2008

41

CEA Presidential Council

President

Gérard de La Martinière
President,
Fédération Française des Sociétés
d’Assurances (FR)

Vice-Presidents
Tommy Persson Pilar González de Frutos
Vice-Chairman, President,
Sveriges Försäkringsförbund Unión Española de Entidades
CEO, Länsförsäkringar Aseguradoras y Reaseguradoras (ES)

Roman Holček
President,
Slovenská asociácia poist’ovní
Chairman of the Board,
Amslico AIG Life Insurance Company (SK)

Members
Rolf-Peter Hoenen George Kotsalos
Member of the Board, Chairman of the International Affairs
Gesamtverband der Deutschen Committee, Hellenic Association of Insurance
Versicherungswirtschaft CEO, Interamerican Group (GR)
CEO, HUK Coburg (DE)

Carlo Acutis Christian Defrancq

Member of the Executive Committee, President,
Associazione Nazionale fra le Assuralia
Imprese Assicuratrici CEO,
Vice-President, KBC Verzekeringen (BE)
Vittoria Assicurazioni (IT)

Erich Walser Treasurer

President,
Schweizerischer
Versicherungsverband Albert Lauper
Chairman & CEO, President of the Administrative Council,
Helvetia Group (CH) Die Mobiliar (CH)
 CEA Annual Report 2007–2008

42

CEA member associations and presidents

AT — Austria DK — Denmark
Versicherungsverband Österreich Forsikring & Pension (F&P)
(VVO) President: Stine Boss
President: Herbert Fichta

EE — Estonia
BE — Belgium Eesti Kindlustusseltside Liit
Assuralia President: Andres Sooniste
President: Christian Defrancq

ES — Spain
BG — Bulgaria Unión Española de Entidades Asegura-
Association of Bulgarian Insurers (ABZ) doras y Reaseguradoras (Unespa)
President: Orlin Penev President: Pilar González de Frutos

CH — Switzerland FI — Finland

Schweizerischer Versicherungsverband Finanssialan Keskusliitto

(ASA/SVV) President: Markku Pohjola
President: Erich Walser
FR — France
CY — Cyprus Fédération Française des Sociétés
Insurance Association of Cyprus d’Assurance (FFSA)

President: Stephie Drakou President: Gérard de La Martinière

GR — Greece
CZ — Czech Republic
Hellenic Association of Insurance
Česká asociace pojišt’oven (ČAP)
Companies
President: Ladislav Bartoníček
President: Fokion Bravos

DE — Germany
HR — Croatia
Gesamtverband der Deutschen
Hrvatski ured za osiguranje
Versicherungswirtschaft (GDV)
President: Marijan Ćurković
President: Bernhard Schareck
CEA Annual Report 2007–2008

43

HU — Hungary MT — Malta
Magyar Biztosítók Szövetsége Malta Insurance Association
(MABISZ) President: David G. Curmi
President: István Filvig

NL — Netherlands
IE — Ireland Verbond van Verzekeraars (VVN)
Irish Insurance Federation (IIF) President: Ludo Wijngaarden
President: Michael Leahy

NO — Norway
IS — Iceland Finansnæringens Hovedorganisasjon
Samtök Fjármálafyrirtækja (SFF) (FNH)
President: Lárus Welding President: Idar Kreutzer

IT — Italy PL — Poland
Associazione Nazionale fra le Imprese Polska Izba Ubezpieczeń (PIU)
Assicuratrici (Ania) President: Tomasz Mintoft-Czyż
President: Fabio Cerchiai

PT — Portugal
LI — Liechtenstein Associação Portuguesa de
Liechtensteinischer Versicherungs- Seguradores (APS)
verband e.V. President: Pedro Rogério de
President: Heiner Keil Azevedo Seixas Vale

LT — Lithuania RO — Romania
Lietuvos draudiku asociacija Uniunea Naţională a Societăţilor de
President: Edmontas Volochovicius Asigurare şi Reasigurare (Unsar)
President: Cristian Constantinescu

LU — Luxembourg
Association des Compagnies SE — Sweden
d’Assurances (ACA) Sveriges Försäkringsförbund
President: Pit Hentgen President: Torbjörn Magnusson

LV — Latvia SI — Slovenia
Latvijas Apdrošinātāju asociācija (LAA) Slovensko Zavarovalno Združenje (SZZ)
President: Juris Dumpis President: Mirko Kaluža

44
SK — Slovakia
Slovenská asociácia poist’ovní
President: Roman Holček
TR — Turkey
Türkiye Sigorta ve Reasürans Sirketleri
Birligi
President: Hulusi Taşkiran
Observers
RU — Russia
All Russian Insurance Association (Aria)
President: Alexander Koval
UA — Ukraine
The League of Insurance Organisa-
tions of Ukraine (LIOU)
President: Oleksandr Filonyuk
CEA Annual Report 2007–2008
UK — United Kingdom
The British Insurers’ European
Committee (BIEC)
Association of British Insurers (ABI)
President: Archie Kane
International Underwriters Association
of London (IUA)
Chairman: Stephen Riley
Lloyd’s of London
Chairman: Lord Peter Levene
CFO Forum
President: Denis Duverne
ICISA
International Credit Insurance &
Surety Association (ICISA)
President: John Rumpler
CEA Annual Report 2007–2008

45

CEA Director Generals’ Conference

Louis Norman-Audenhove Jörg Freiherr Frank von Fürstenwerth

Secretary General CEO
AT — Austria DE — Germany
Versicherungsverband Gesamtverband der Deutschen
Österreich (VVO) Versicherungswirtschaft (GDV)

René Dhondt Per Bremer Rasmussen

Director General CEO
BE — Belgium DK — Denmark
Assuralia Forsikring & Pension (F&P)

Orlin Penev
Kristjan Niinemaa
Chairman
CEO
BG — Bulgaria
EE — Estonia
Association of Bulgarian
Eesti Kindlustusseltside Liit
Insurers (ABZ)

Lucius Dürr Aránzazu del Valle Schaan

CEO Secretary General
CH — Switzerland ES — Spain
Schweizerischer Versicherungs- Unión Española de Entidades
verband (ASA/SVV) Aseguradoras y Reaseguradoras (Unespa)

Stephie Dracos
Satu Huber
CEO
Managing Director
CY — Cyprus
FI — Finland
Insurance Association
Finanssialan Keskusliitto
of Cyprus

Tomáš Síkora Jean-Marc Boyer

CEO Director General
CZ — Czech Republic FR — France
Česká asociace pojišt’oven Fédération Française des
(ČAP) Sociétés d’Assurance (FFSA)
 CEA Annual Report 2007–2008

46

Margarita Antonaki
Andrius Romanovskis
General Director
Director
GR — Greece
LT — Lithuania
Hellenic Association of
Lietuvos draudiku asociacija
Insurance Companies

Paul Hammelmann
Hrvoje Pauković
Legal Advisor
Manager
LU — Luxembourg
HR — Croatia
Association des Compagnies d’Assurances
Hrvatski ured za osiguranje
(ACA)

Zoltán Forgács Juris Dumpis

Executive Director President
HU — Hungary LV — Latvia
Magyar Biztosítók Latvijas Apdrošinātāju
Szövetsége (MABISZ) asociācija (LAA)

Michael Kemp
Anton Felice
CEO
Director General
IE — Ireland
MT — Malta
Irish Insurance Federation
Malta Insurance Association
(IIF)

Guðjón Rúnarsson
Richard Weurding
Managing Director
General Manager
IS — Iceland
NL — Netherlands
Samtök Fjármálafyrirtækja
Verbond van Verzekeraars (VVN)
(SFF)

Giampaolo Galli Arne Skauge

Director General Managing Director
IT — Italy NO — Norway
Associazione Nazionale fra Finansnæringens
le Imprese Assicuratrici (Ania) Hovedorganisasjon (FNH)

Heiner Keil
Tomasz Mintoft-Czyż
President
President
LI — Liechtenstein
PL — Poland
Liechtensteinischer
Polska Izba Ubezpieczeń (PIU)
Versicherungsverband e.V.
CEA Annual Report 2007–2008

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Alexandra Queiroz
General Manager
PT — Portugal
Associação Portuguesa de Seguradores (APS)

Florentina Almajanu
Director General
RO — Romania
Uniunea Naţională a Societăţilor de Asigurare şi
Reasigurare (Unsar)

Christina Lindenius
Managing Director
SE — Sweden
Sveriges Försäkringsförbund

Mirko Kaluža
Director
SI — Slovenia
Slovensko Zavarovalno Združenje (SZZ)

Jozefína Žáková
Director General
SK — Slovakia
Slovenská asociácia poisťovní

Erhan Tunçay
Secretary General
TR — Turkey
Türkiye Sigorta ve Reasürans Şirketleri Birliği

Stephen Haddrill
Director General
UK — United Kingdom
Association of British
Insurers (ABI)
 CEA Annual Report 2007–2008

48

CEA committee chairpersons

Insurance of the Person

Accident Insurance
Life Insurance
Uwe Breuer
Gérard Ménéroud
Director
Deputy Chief Executive
R+V Allgemeine
CNP (FR)
Versicherung (DE)

Health Insurance
Pim van de Werd
Director, Kennis en
Beleidscentrum Zorg
Avéro Achmea (NL)

Non-Life Insurance

Motor Insurance Atomic Risks

François Bucchini Christoph Stalder
Chairman Public Affairs Director
AXA Cessions (FR) Schweizerische Mobiliar Holding (CH)

General Liability Insurance Agricultural Risks

Philip Bell Antonio Fernández Toraño
Group Casualty Director Chairman
RSA (UK) Agroseguro (ES)

Legal Expenses
Gustaaf Daemen
Chief Executive Officer
DAS (BE)
CEA Annual Report 2007–2008

49

Community Affairs

Single Market
Alastair Evans
Head of Government & International
Regulatory Affairs
Lloyd’s (UK)

General Affairs

International Affairs Social Affairs

Brigitte Bovermann Sebastian Hopfner
Executive Vice-President Director, Legal Department
Allianz (DE) AGV (DE)

Communication & PR
Economics and Finance Patrick Nally
Joseph B.M. Streppel Director of Marketing &
Chief Financial Officer Public Relations
Aegon Verzekeringen (NL) RSA (IE)
 CEA Annual Report 2007–2008

50

CEA staff all e-mails = [surname]@cea.eu

General Management

Michaela Koller Gina O’Rourke Danny Dehaes

Director General Executive Assistant Executive Secretary

Economics & Finance

Alberto Corinti
Yannis Pitaras Benoit Malpas
Deputy Director General,
Project Manager, Policy Advisor/
Director, Economics
Solvency II Technical Manager
& Finance

Catherine Munt Silvia Herms Mohamed Selmaoui

Policy Advisor/Technical Policy Advisor/Technical Policy Advisor/Technical
Manager, Solvency II Manager, Solvency II Manager, Solvency II

Marta González Ido Bruinsma

Luc Stevens
Policy Advisor/Technical Policy Advisor,
Policy Advisor,
Manager, Solvency II International Affairs
Economics & Statistics
(secondee) & Reinsurance

Catherine Goislot
Valérie Rein Anne Halbardier
Policy Advisor,
Secretary Secretary
Economics & Statistics

Insurance of the Person

Caroline Bissegger
Kai-Marjep Kosik Policy Advisor, Insurance Cláudia Sousa
Head of Department of the Person Policy Advisor, Taxation
(secondee)
CEA Annual Report 2007–2008

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Non-Life Insurance

Sandrine Noël Hakima Ben Azzouz Kathrin Hoppe

Head of Department Policy Advisor Policy Advisor

Ana Solomiak
Secretary, Non-Life Insurance
and Insurance of the Person

Single Market & Social Affairs

William Vidonja Francesco Zanella Alina Domaradzka

Head of Department Policy Advisor Policy Advisor

Claudine Brigué
Secretary

Public Affairs

Amélie Chantrenne
Gabriela Diezhandino Frida Bergman Secretary, Public Affairs
Head of Department Policy Advisor and Communications &
Public Relations

Communications & Public Relations

Janina Clark Annemarie Bos

Head of Department Policy Advisor

Human Resources, Accounts & IT

Koen Ameye Corentin Pollet Brigitte Thomassen

Human Resources ICT, Information Administrative
Manager Systems, Logistics Assistant
 CEA Annual Report 2007–2008

CEA
I nsur e r s of Eur ope

CEA aisbl
Square de Meeûs 29
B-1000 Brussels
Belgium
Tel: +32 2 547 58 11
Fax: +32 2 547 58 19

www.cea.eu