EC reduces charges for insurers in PE

The EC presented a review of the Delegated Acts on Solvency II on Friday, including the creation of a new category for long-term equity investments, which could include PE fund investments. Insurers investing into funds that will fall under this category will benefit from a reduced 22% risk-weight (down from 39%), allowing them to set aside less capital to manage the perceived risks of these investments.

Insurance companies accounted for just 8% (€5.7bn committed) of European private equity fundraising in 2017, whereas pension funds made up 29% (€21bn), according to Invest Europe data.

Invest Europe's head of public affairs, Anna Lokton, told Unquote: "The change proposed by the European Commission on Friday could be a step towards bridging the gap between these two types of long-term institutional investors for investments in European private equity."

In total, insurance companies have European investment portfolios worth more than €10tn, according to Insurance Europe's October 2018 Key Facts publication.

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