* “Little evidence” of systemic risk - lobby group
* Recognise insurers’ “specific characteristics” - lobby
LONDON, June 17 (Reuters) - Leaders of the Group of 20 nations should consider exempting insurers from a regulatory clampdown aimed at preventing a repeat of the financial crisis, an insurance industry body said on Thursday.
G20 leaders meeting in Canada next week should recognise that there is “little evidence” of insurers posing a threat to the wider financial system or economy, lobby group the Geneva Association said.
“It is highly important that any solutions designed to increase the resilience of the financial system appropriately acknowledge the specific characteristics of insurance from other financial services,” the body said in a letter to G20 leaders, finance ministers and central bankers.
Insurers are concerned that tough new rules designed to strengthen the financial system could be applied to them as well as to the banking sector, seen as the main culprit for the 2008 meltdown.
Last week, European Union officials wrote in a report that a planned state levy on banks could be applied to other financial services firms, stirring fears insurers could also be targeted. [ID:nLDE6562DV]
Concerns over potential “regulatory overspill” were also raised last year when European Central Bank governor Jean Claude Trichet said the view that insurers could not on their own destabilise the financial system “needs to be challenged.”
In February, the Geneva Association said that insurers pose no threat to the financial system because of their strong cash flows, underpinned by up-front payments from customers, and the long-term nature of their financial obligations. [ID:nLDE61P0PM] (Reporting by Myles Neligan; Editing by Jon Loades-Carter)