Rip off policyholders to save the planet

Reported in InsuranceERM

On investment in green finance, Evans [Huw Evans, on his last day as director general of the Association of British Insurers] said a useful debate about how the Solvency II Matching Adjustment can be improved has been somewhat overtaken in the UK by a series of Bank of England/PRA interventions. According to Evans, these are seeking to force changes to the fundamental spread element of the Matching Adjustment.

“Not only is this an issue that wasn’t even included by HM Treasury when it set the remit for the review, any changes are almost guaranteed to increase insurer capital levels and make the UK less competitive than insurers based in the EU. And any chance of a significant boost to green investment will almost certainly be lost.”

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