A one-size-fits-all application of Solvency II to captives should be replaced with a tailored regime, according to Annick Felten, member of Luxembourg’s insurance supervisor, the Commissariat aux Assurances.
Felten, in a speech at the European Captive Forum in Luxembourg, suggested that the standardised Solvency II regime needs to be adjusted to suit the captive industry.
During the 2010 European Captive Forum, Felten said attendees were concerned whether there would be an appetite for captives in Europe after Solvency II. However, at this year’s conference, hosting more than 1,000 attendees, there was still a clear interest.
She explained that captives are taking on new and emerging risks and this is important for the industry as it expands.
Felten also talked about the Organisation for Economic Co-operation and Development’s (OECD) base erosion and profit shifting (BEPS) action plan.
She suggested companies in the industry should consider what impact BEPS may have on captives and explained that their owners and managers need to try to find a balance in its application.
The EU’s implementation of the OECD’s BEPS rules, the Anti-Tax Avoidance Directive, is set to come into force in member states on 1 January 2019.
