In the aftermath of the 2008 financial crisis one thing became abundantly clear: the EU was not adequately equipped to ensure the effective cooperation and coordination between national financial supervisory bodies, or the consistent application of the EU legal framework across all Member States. The creation of EIOPA (as one of the European Supervisory Authorities) was one of the many remedies proposed. On Thursday the 8th of March 2018, the European Court of Auditors (ECA) published a background paper on EIOPA in preparation for an upcoming audit of the organization`s contribution to the supervision and financial stability of the EU’s insurance sector.
BETTER FINANCE’s Managing Director, Guillaume Prache, was heard by the ECA with regards to the upcoming audit as a stakeholder representing the interest of savers and investors across the EU. While the final background paper does not present conclusions, it does provide insights into the issues under investigation. In total, five specific issues were identified, including the benefit of stress-tests, the significance of EIOPA recommendations and to what extent EIOPA has sufficient staff for the workload and whether the staff has appropriate levels of expertise. The upcoming audit will take place in the context of the proposed reform of the ESAs, presented by the EC and described as an extreme disappointment by BETTER FINANCE and other stakeholders in November of last year. As financial consumers continue to suffer from mis-selling and other abuses within the EU, the EC is seen as having missed a historic opportunity to propose a much needed ambitious reform of the ESAs. With the important role played by the insurance industry in the EU economy, and its substantial influence on financial stability, the results of the upcoming audit are of great importance to BETTER FINANCE and its members. BETTER FINANCE will continue to monitor the situation closely, voicing the concerns of savers and investors across Europe, ensuring everyone keeps skin in the game.