European challenge for Swiss insurers

Brussels, 17th October 2006 – Swiss Ambassador Bernhard Marfurt today welcomed business and political representatives to a discussion forum on the position of the Swiss insurance industry in the European Union (EU) at the Swiss Mission in Brussels. Speaking to an international audience, high-ranking representatives of the insurance industry underscored the importance of the EU for Swiss insurers and their role in the EU. They advocated mutual recognition of insurance supervisory bodies and for a strong, market-friendly regulatory regime to enhance the competitiveness of the European insurance industry.

No fewer than four Swiss companies rank among the 20 largest insurance groups in Europe. More than 70% of the premium volume generated by Swiss private insurers comes from outside Switzerland and more than 40% of this stems from the EU. Much insurance regulation today is also internationally meshed, such as the Swiss Solvency Test and its European counterpart, Solvency II.

Switzerland ready and willing to actively cooperate at European level

Albert Lauper, Chairman of the Swiss Insurance Association, stressed the fact that if the European insurance industry is to be competitive, internationally recognised standards and regulations must be established and developed. Mr Lauper told the representatives of the EU, «The Swiss insurance industry is ready and willing to work within the EU to create more favourable conditions in the EU insurance market.» He also expressed Switzerland’s strong interest in the development of international competition, «The insurance markets of the European Union are very important to Swiss companies, just as Switzerland is an attractive market for European insurers.»

Exploitation of the competitive advantage of a superior regulatory regime

In his speech, James J. Schiro, CEO of Zurich Financial Services, emphasised that Europe was well on the way to creating a superior regulatory regime. «This gives European insurers a competitive advantage in the global market and is ultimately in the interests of our clients.» However, he also noted that there was a risk of Swiss companies being disadvantaged in the EU. But this would not be justified, because, «The supervisory regulations laid down by the Swiss Federal Office of Private Insurance are among the strictest in Europe, and the integrated financial supervisory law that is currently being discussed in parliament complies with, or even exceeds, all European standards.» Schiro stressed he was committed to the principle of mutual recognition and to working with the Federal Office of Private Insurance.

Solvency II will encourage sound risk management practices and governance

Agostino Galvagni, Member of the Executive Board and Head of Globals & Large Risks, Swiss Re, stressed that the European Union was a key market for Swiss Re. He went on to confirm that Swiss Re welcomes the introduction of Solvency II, because risk-based solvency regimes will encourage sound risk management practices and proper governance structures. He was of the opinion that due consideration should be given to diversification and effective risk mitigation measures - including derivatives, reinsurance and securitisation.

A panel discussion then followed with Elemér Tertak (Director of the Directorate Financial Institutions European Commission, DG Internal Market Services), Agostino Galvagni (Swiss Re), Bruno Pfister (CEO International, Swiss Life), Dieter Wemmer (CEO of Europe General Insurance, Zurich Financial Services).

Speeches

• Albert Lauper: «The Swiss insurance industry at the European level: Significance and challenges for the future»
• Speech by James J. Schiro: «The European challenge for a global insurer»
• Agostino Galvagni: «Reinsurance in Europe: the role of Swiss Re – a global reinsurer in Switzerland»