Solvency 2 review should focus on sustainable recovery: Generali CEO
Donnet stated that Generali believes strongly in the Solvency 2 system, adding that they have increased their solvency ratio from 2017 to 2020, despite the Covid-19 pandemic. “The Solvency 2 system is an effective one. It must remain transparent and fair. The Solvency 2 review should focus on sustainable recovery. It should not be based on technical and useless matters but contribute to the recovery,” said Donnet, at a Politico event.
Solvency 2 measures riskiness of asset classes. “It is important to reduce riskiness of recovery, especially green recovery. Our proposal is to make a special asset class for green bonds and to better treat this asset class in terms of capital charge, which will push long-term investors to stay invested over long-term. This is a practical measure to improve Solvency 2 and make it objective to sustainable recovery,” added Generali’s CEO.
Donnet also stated that they have been proactively pushing the EU for solutions to better protect people and small and medium enterprises (SMEs) against systemic risks. “Many people are not protected enough. The capacity of the insurance and re-insurance industry is not enough to deal with the risk of the pandemic. If we have a look at all the countries, it is impossible for the industry to pay for business intervention. This is an opportunity for the EU to build a protection system which is the outcome of a public-private partnership. We need different layers of protections: from the insurance industry, reinsurance industry, member state systems and from the EU. This could build a stronger, better protection system to face the next pandemic while spending less,” he added.