Covered Agreement US-EU: What You Need to Know

The Covered Agreement, also known as the Bilateral Agreement between the United States and the European Union, is a historic agreement signed in 2017 that aims to create a level playing field for insurance companies doing business in both regions. The agreement has significant implications not only for the insurance industry but also for the larger financial services sector and the wider economy. In this article, we will take a closer look at the Covered Agreement US-EU and what it means for businesses and consumers.

What is the Covered Agreement?

The Covered Agreement is a mutual recognition agreement between the United States and the European Union that aims to eliminate regulatory barriers to trade in the insurance industry. It was signed in September 2017 after years of negotiations between the two parties. The agreement provides for the mutual recognition of insurance regulations and the elimination of discriminatory measures that restrict the ability of insurance companies to do business in both regions. The agreement also enhances regulatory cooperation between the two parties, which is expected to promote a more efficient and effective regulatory environment in the insurance industry.

What are the implications of the Covered Agreement for businesses?

For insurance companies, the Covered Agreement means greater access to markets in the United States and the European Union. The agreement eliminates the need for companies to comply with multiple sets of regulations in order to do business in both regions. This is expected to reduce compliance costs for companies and increase competition, which is good news for consumers. The agreement also provides greater legal certainty for companies, which is expected to encourage greater investment in the insurance industry.

The Covered Agreement also has implications for other businesses in the financial services sector. The agreement is expected to promote greater regulatory cooperation between the two parties, which could lead to greater alignment of regulations in other areas. This could reduce compliance costs and increase competition in the financial services sector, which could benefit consumers and businesses alike.

What are the implications of the Covered Agreement for consumers?

For consumers, the Covered Agreement means greater choice and lower prices in the insurance industry. The agreement is expected to increase competition among insurance companies, which could lead to lower premiums for consumers. The agreement also ensures that consumers are protected by high standards of consumer protection and regulatory oversight in both regions, which should give consumers greater confidence in the insurance products they purchase.

What are the next steps?

The Covered Agreement is being implemented in stages, with some provisions already in force and others set to be implemented in the coming years. The agreement is expected to be fully implemented by 2023. In the meantime, insurance companies and other businesses in the financial services sector should be monitoring developments and preparing for the changes that the Covered Agreement will bring.

Conclusion

The Covered Agreement US-EU is a significant agreement that is expected to have broad implications for the insurance industry, the financial services sector, and the wider economy. The agreement is expected to promote greater competition, reduce compliance costs, and increase consumer choice and protection. Companies in the insurance industry and other businesses in the financial services sector should be monitoring developments and preparing for the changes that the Covered Agreement will bring. Consumers should also be aware of the potential benefits of the agreement, including lower prices and greater choice in the insurance industry.