Sven Giegold

The future of the insurance industry – some answers

Short interview with on the future of the insurance industry. Find my answers here:


Question: According to Mr. Giegold, what are the main opportunities for insurers in the European context in the coming years? In other words, in which areas or in what way can they add value, remain relevant to customers etc.?

Solidarity is the core principle of insurance. In particular in times of economic uncertainty the need for solidarity is rising. Insurers should take the opportunity to focus on this basis of their business: to organise solidarity in a fair, efficient and transparent manner.


Question: What are the main threats to insurers in the European context in the coming years? It would also be nice to hear what stance, according to Mr. Giegold, insurers should take to combat these threats.

The business of insurance is based on trust. Policyholders must be able to rely on their insurer to live up to its commitments and to pay the insurance benefits when they fall due. The financial crisis has shown that financial institution can quickly loose the trust of their customers when their business practice is questionable or their financial resources deteriorate. Insurers are not immune to that serious threat.
The European insurance regulation is currently undergoing a fundamental reform called Solvency II that will in particular change the requirements on the provisions insurers have to set up for their insurance obligations. The insurance industry has been heavily lobbying the European legislators to reduce the requirements to a level that is unlikely to be sustainable. Solvency II may include a number of concepts like the counter-cyclical premium or the matching premium which would allow insurers, at least temporarily, to set up provisions lower than what is realistically needed to fulfil the insurance obligations. This would undermine the very basis of the business model of insurance, namely the trust in the insurer’s ability and willingness to live up to the commitments towards policyholders.

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