What are the key regulatory initiatives in European life insurance you are currently looking at?
There is a broad set of risks in focus, but if I had to prioritise, I would point to the following three.
First, geopolitical risk and the possibility of a repricing of risk premia. Financial markets have been resilient, but they are still operating in an environment marked by geopolitical tension, trade uncertainty and elevated public debt. In that setting, the question is whether current valuations can be sustained. For life insurers, any sharp change in market sentiment matters on both sides of the balance sheet: through asset prices, credit spreads, liquidity conditions and, ultimately, the valuation of liabilities. EIOPA has explicitly warned that adverse developments could trigger such a repricing and therefore require continued monitoring and prudent risk management.
Second, concentration risk, including in sectors that have attracted outsized investor enthusiasm, such as technology and AI. The point is not to assess whether there is a bubble. One would most likely get that wrong. It is rather to recognise that when market expectations become very demanding and exposures become concentrated, the downside becomes more asymmetric. A correction does not need to be broad-based to become material for insurers if it affects crowded trades or correlated positions.
Third, the “known unknowns” around illiquid and less transparent exposures. Private credit is a good example. It offers diversification and an illiquidity premium, which can suit long-term investors, but it also comes with higher credit and liquidity risk, valuation uncertainty and potential hidden leverage. It does not need to be a direct exposure to an insurer’s balance sheet, it can also be through exposures through funds, etc. Although at sector level such exposures are contained, there may be pockets with higher concentrations that warrant closer monitoring. Liquidity stress is another example of the picture: potential for margin calls, collateral needs and spillovers can matter even for institutions that are not structurally exposed to bank-like runs.
On the first of these – a repricing of risk premia on the asset side. There has been a clear shift towards private asset investing around the world. Do you see this in Europe too? What are the risks and might it be something to regulate?
Yes, we do see this trend in Europe as well, although it is generally less pronounced than in some other mature markets. EIOPA’s recent work confirms that insurers have continued to expand allocations to private credit even after the rise in risk-free rates, so this is not just a legacy response to the low-yield era. There are clear benefits. For long-term investors such as life insurers, private assets can offer an illiquidity premium, portfolio diversification and better matching with long-duration liabilities. That is why one should be careful not to treat all growth in private assets as a prudential problem in itself.
But risks must also be well understood. EIOPA highlights valuation uncertainty, higher credit and liquidity risk, potential for hidden leverage, and concentration risk. In private credit specifically, insurers’ exposure exceeded €500 billion, or approximately 5% of total assets, at end-2024. EIOPA also notes that concentrations by sector or geography can offset diversification benefits and amplify losses in a downturn. More broadly, where illiquid assets cannot be sold quickly, they can become a vulnerability if firms face collateral demands, margin calls or other unexpected cash needs.
So I would not say the answer is “regulate private assets” in a blunt sense. The better answer is better risk management, better valuation discipline, stronger liquidity planning and closer supervisory monitoring where exposures are material or concentrated. That is also very much the direction EIOPA is taking when discussing these risks.
Possibly linked to this, some suggest the level of systemic risk of the life insurance industry has risen. Do you feel so, and is there a case for prudential regulation to consider the systemic component in European life?
The systemic relevance of insurance has undoubtedly increased, mainly because the sector plays a larger role in capital markets and in financing the real economy. But that does not automatically mean that life insurers should be treated as if they were banks, or that an entirely new prudential architecture is needed.
My view is that the right starting point is to recognise that Solvency II already contains macroprudential features, even if it was originally designed as a microprudential framework. EIOPA itself has stressed this point in its response to the EU debate on NBFI. The long-term guarantee measures were built precisely to reduce unnecessary procyclicality for longterm investors such as insurers, and the recent Solvency II review goes further by introducing new macroprudential tools.
The most important step forward is that the review now formalises a clearer macroprudential layer. In particular, it introduces liquidity risk management plans and macroprudential analyses in ORSA and under the prudent person principle, giving supervisors a better basis to identify spillovers, common reactions to shocks and vulnerabilities that matter at sector level, not just firm level.
So yes, the systemic dimension deserves more attention. But the better answer is, in my view, not to import a banking template into insurance. It is to continue building an insurance-specific macroprudential framework consistent to Solvency II, proportionately and with full regard to the longterm nature of insurance liabilities.
Where does EIOPA stand on the involvement of PE in insurance? What are you doing with regard to this?
The European supervisory community exchanged experiences, took lessons learned from several cases and recently set out some clear supervisory expectations. EIOPA is not anti-private equity, but it is concerned that certain PEled models can create supervisory challenges and potential misalignment with the long-term nature of insurance liabilities.
On 3 February 2026, EIOPA launched a public consultation on a draft supervisory statement on the authorisation and ongoing supervision of insurers and reinsurers related to private equity firms. The starting point is that PE firms have shown growing interest in acquiring European re-insurers over the past decade, although less material when compared to the US , often bringing changes in strategy, governance, risk management and asset allocation.
The risks EIOPA highlights are quite specific: short or misaligned investment horizons, significant changes in business models including private credit, illiquid assets and balance-sheet optimisation (through potentially aggressive, not realistic, valuation assumptions leading to a undervaluation of technical provisions or over-valuation of reinsurance recoverables), greater reliance on reinsurance including within the same PE group and sometimes involving third-country reinsurers and complex ownership structures that can make effective supervision more difficult.
The draft supervisory statement therefore sets supervisory expectations in two main areas. First, regarding business model and governance, supervisors are asked to assess post-acquisition strategies, the alignment of investment horizons with long-term liabilities, the credibility of multi-year business plans, and the adequacy of insurance expertise at board level. Second, regarding ownership structures and prudential risks, supervisors are encouraged to ensure transparent structures and to apply enhanced scrutiny to illiquid and alternative investments, valuation practices, asset-liability management, reinsurance effectiveness, solvency sustainability, leverage and acquisition financing.
So the regulatory direction is clear: more supervisory convergence, more transparency and more scrutiny of ownership, governance, business plans, intragroup arrangements and investment strategy – but still within a riskbased and proportionate framework, rather than a blanket restriction on PE ownership. The consultation runs until 30 April 2026.
Europe has seen a few asset intensive reinsurance deals. Is this positive or negative for you? And could EIOPA have a role in setting guidance as it did with the mass lapse paper last year?
I would not describe asset intensive reinsurance as either inherently positive or inherently negative. It is a tool, and the prudential question is whether the economic substance of risk transfer matches the capital benefit being claimed.
EIOPA’s approach is balanced. It recognises that reinsurance plays an important role in healthy markets and that more complex structures are emerging, including profit-sharing arrangements, mass-lapse reinsurance and asset intensive reinsurance. At the same time, EIOPA has warned that funded or asset intensive deals can introduce credit, legal and operational risks, and that the concentration of this business among a relatively small number of reinsurers, often in specific offshore jurisdictions, warrants continued scrutiny.
On your second point, yes – EIOPA clearly has a role in setting supervisory expectations here. It already did so for mass-lapse reinsurance in July 2025, when it published detailed annexes to its 2021 Opinion on risk-mitigation techniques in order to promote a common supervisory approach. And importantly, EIOPA’s 2026 work programme explicitly says it will provide guidance on the supervision of reinsurance as a risk-mitigation technique, including a draft annex on asset intensive reinsurance for consultation in Q3 2026.
So the direction of travel is quite clear: not focusing on prohibition, but closer scrutiny, more convergence and a stronger focus on genuine risk transfer, legal certainty and concentration risk.
Longevity reinsurance is booming in the Netherlands. What are the drivers and will the rest of Europe follow suit? What occupation should you pursue if you want to live longest? According to the panel on longevity at Life-Re Europe, librarian
It has been long talked about but consolidation could be coming to Europe in a big way as participants from Viridium and Frankfurter Leben discussed at Life-Re Europe.
Has the PRA crashed the funded re market? That is the question many are asking following its recent proposal to hit the UK’s funded re business with a 10% capital charge.
Asset intensive reinsurance (AIR) has taken hold in life markets around the world. Europe, though, is a different story. But does Europe really need AIR?
Life-Re Europe held its first event in April. From longevity to reinsurance, assets to regulations, the forum covered a manifold range of key topics for the European life insurance market.
Regulatory certainty is key to a flourishing life reinsurance market. At Life-Re Europe, regulators showed receptivity to this newly emerging market development.
©2025 Life-Re