At its meeting on 7 July 2016, the NBS Executive Board adopted the Strategy for Implementation of Solvency II in Serbia. The Strategy was amended in 2018 in accordance with the third revision of the National Programme for Adoption of the Acquis. As the new EU enlargement methodology was adopted and Solvency II review is expected to be finalised in 2021, at its meeting on 13 May 2021 the NBS Executive Board adopted the latest amendments and supplements to the Strategy for Implementation of Solvency II in Serbia. In view of the importance and complexity of implementation of Solvency II, the Strategy will be regularly reviewed and amended on an as needed basis, in accordance with new circumstances and challenges.
The new Solvency II Directive (Directive 2009/138/EC of the European Parliament and of the Council on taking-up and pursuit of the business of Insurance and Reinsurance) repeals 14 directives commonly referred to as Solvency I and provides for a maximum harmonisation regime, thereby ensuring greater convergence within the internal market of insurance services in the EU.
Solvency II is based on three pillars:
- Quantitative requirements
- Qualitative requirements,
In line with Serbia’s EU accession process, Solvency II will be implemented in stages, taking into account the level of compliance achieved thus far (the Insurance Law which has been in force since 2015 implements the qualitative requirements under Pillar 2 of Solvency II), the expected development of the Serbian insurance sector and the analysis of the impact of the implementation of Solvency II on the domestic insurance market.
Following a multi-year transitional period allowed for alignment with new regulatory requirements, on 1 January 2016 the EU started to implement the Solvency II Directive. Solvency II repeals 14 directives (commonly referred to as Solvency I) and provides for a maximum harmonisation regime, thereby ensuring greater convergence within the internal market of insurance services in the EU.
Under Solvency II, the European Commission is in charge of adopting delegated or implementing acts directly applicable in the EU member states, which ensure full harmonisation of rules governing the insurance business. Technical standards are adopted by the European Commission at the proposal of the European Insurance and Occupational Pensions Authority (EIOPA).
The EIOPA adopts guidelines which ensure consistent implementation of rules and cooperation between member states. While guidelines are not mandatory, any deviation from them must be duly justified.