The United States and the European Union have signed a landmark trade deal — the “covered agreement” — that lifts certain requirements for U.S. insurers and reinsurers active in the EU market. Under the covered agreement, U.S. insurers with a presence in the EU will be subject to standards set by the National Association of Insurance Commissioners. Goldberg Segalla’s Global Insurance Services Practice Group Co-Chair Jeffrey L. Kingsley commented on the news for Law 360.
According to Jeff, the deal encourages trust between U.S. and EU regulators and their overseas counterparts. “I think there may be some gray areas in the interpretation and implementation,” Jeff said, “but generally, it will benefit insurers and reinsurers in both jurisdictions by allowing them to avoid having to comply with onerous reporting guidelines and regulatory restrictions that could make it prohibitively expensive for them to enter the foreign market.” Jeff predicted that, while “state regulators may have to make some minor changes to be consistent with the covered agreement,” measures pertaining to collateral and credit requirements that reinsurers have already taken “will largely stand.”