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COVID-19 Europe: Insurance regulation in times of Covid-19: First responses from Continental Europe

  • Market Insight 8 April 2020 8 April 2020
  • UK & Europe

  • Coronavirus

As the Covid-19 outbreak continues to challenge the global economy, European insurance regulators have taken immediate measures to mitigate the impact of the pandemic on the insurance sector. The following provides an overview on the current developments in continental Europe and outlines the approach taken by the German, French and Spanish regulators.

COVID-19 Europe: Insurance regulation in times of Covid-19: First responses from Continental Europe


Following the recommendations of EIOPA (EIOPA statement on actions to mitigate the impact of Coronavirus/COVID-19 on the EU insurance sector of 17 March 2020), the German Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) announced a number of measures taken to help insurers during the time and in the aftermath of the Covid-19 pandemic. Among these measures are in particular detailed rules concerning longer timeframes for reporting requirements under Solvency II and the Holistic Impact Assessment.

As to the reporting requirements under Solvency II the limits are prolonged by two to eight weeks depending on the relevance of the information in question. The time limits for the Solvency and Financial Condition Report (SFCR) will be extended by two months until 1 June 2020.

While the time limits are prolonged, insurers are encouraged to provide early submissions of the first quarterly submission 2020 as any appropriate information on the effect of Covid-19 is considered extremely important to coordinate any further steps.

Furthermore, EIOPA and BaFin reminded insurers to take all appropriate measures to preserve their capital position for as long as possible. Nevertheless, EIOPA is optimistic as recent stress tests have shown that the sector is well capitalised (a lot better than in 2008) and will be able to withhold severe but plausible shocks to the system.

In Germany, there have also been demands for a state driven reinsurance solution to tackle the insurance cover gaps for companies. Many companies are not insured for cases of business interruptions as insurance cover for pandemics is a highly unpredictable risk and does not appear attractive to insurers. Therefore, a similar solution similar to Extremus – insurance cover backed by state guarantee for terrorism losses – has been suggested. The envisioned reinsurance should be provided by the state to all primary insurers that want to offer coverage for damages arising out of business interruptions due to pandemics or natural catastrophes to make this business less of a risk for the primary insurer.


Similarly to Germany, the French supervisor ACPR has implemented EIOPA's recommendations. As such quarterly reporting will benefit from two additional weeks (except for the reporting on derivative transactions which will benefit from eight additional weeks ). The same applies to yearly reporting as well as to SFCR and RSR reportings which benefit from two to eight additional weeks. ORSA submission has been postponed to 31 December 2020 which will allow, if applicable, the assessment of the COVID-19 situation's impact on supervised entities.

Other types of reporting have also been delayed such as on commercial practices (to 30 September 2020) and on unclaimed life assurance benefits (to 30 June 2020).

Importantly, the ACPR has acknowledged that electronically signing all documents submitted may be challenging during these times and will accept documents without electronic signatures or with invalid signatures. This is temporary and unsigned documents will need to be re-submitted with the Q2 reporting at the latest.

The French Insurance Federation FFA has also announced that it will contribute 200 million euros to the solidarity fund put in place by the state in favour of SMEs and self-employed workers. In addition, insurers have agreed to maintain the benefit of insurance contracts for companies facing financial distress and therefore unable to pay premiums as they become due for the duration of confinement.


Unlike the German and French Regulator, the Spanish Insurance Supervisory Authority (Dirección General de Seguros y Fondos de Pensiones –DGSFP-) has not implemented EIOPA´s recommendations yet, but rather published an informative note on its website summarising and informing of such recommendations.

The note further informs that the General Directorate of Insurance and Pension Funds (DGSFP) has actively participated in this EIOPA´s initiative and anticipates its commitment to comply with the recommendations regarding the flexibility of deadlines proposed and additional issues. To this end, the DGSFP is currently working to put in place the relevant legal and operational measures in order to allow an implementation in the most efficient way, and has indicated that flexibility on reporting deadlines would also apply to other insurance distributors and pension funds.

In light of the above, a resolution implementing EIOPA´s recommendations in Spain is expected to be issued very shortly.

In the meantime, it should be noted that given the very serious effects arising from the COVID-19 pandemic, the Spanish Government published, on 14 and 18 March, Royal Decree 463/2020, declaring the "State of Alarm" ("Estado de Alarma") for the management of the health crisis situation caused by COVID-19 and Royal Decree-Law 8/2020, on extraordinary urgent measures to face the economic and social impact of COVID-19. Among many other issues, these pieces of regulation provide that terms and deadlines applicable to administrative files before the DGSFP are suspended until the "State of Alarm" official declaration terminates. This would also apply to terms and deadlines applicable to Spanish judicial proceedings where insurers may be involved.

As anticipated, it is expected that the DGSFP will shortly inform of applicable deadlines to the different regulatory obligations to be complied with by the different market players in Spain and, more specifically, interaction between EIOPA´s recommendations and the specific situation that apply in Spain during and after the "State of Alarm" official declaration and the suspension of administrative deadlines.

As the COVID-19 pandemic continues, it is likely that regulators will provide further guidance or set additional rules. Please contact us if you have any questions regarding the issues discussed in this post or with respect to the broader response of local insurance regulators to the challenges posed by COVID-19.


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