A bill is pending for increasing the foreign investment in insurance joint ventures to 49%.
However, an existing regulation requires that after completing 10 years of operation, overseas investment in such companies would have to be brought back to 26% anyway.
So the new law would be relatively useless.
“It is absolutely imperative that changes are made to the overly conservative approach being adopted in several areas,” says the letter to Commissioner Barnier, which is co-signed by:
the CEA, the European insurance and reinsurance federation;
the Pan European Insurance Forum;
the CFO Forum;
and the CRO Forum.
Insurance Australia Group is said to have calculated numbers over its cat bond issue. Suncorp Group is also considering tapping the market.
A senior executive at IAG or Suncorp said the rising cost of reinsurance made the pricing of the bonds attractive.