After several years of negotiation, the European Union and the United States of America officially signed a bilateral agreement on insurance and reinsurance, called a “covered agreement”, on Friday, September 22nd.
The Association of Reinsurance Professionals in France (APREF) welcomes the signature of this agreement, which establishes a form of ‘mutual recognition’ between prudential regulations on both sides of the Atlantic, thereby facilitating the operations of European and American insurers and reinsurers.
The agreement provides, prospectively and under certain conditions, for the removal of the regulatory collateral requirements for reinsurance contracts between American ceding companies and European reinsurers. It also removes the local presence requirements imposed specifically on (re)insurers based in the United States and operating in the European Union, and vice versa. Finally, it establishes a system of optimal role sharing in terms of group supervision.
The agreement will come into force provisionally, but its definitive implementation will take several years. APREF will monitor the various steps of this concrete application and will keep its members duly informed.