EIOPA launches consultation on IRRD

On 9 December 2025, the European Insurance and Occupational Pensions Authority (EIOPA) published on its website a set of seven consultation papers to support the implementation of the Insurance Recovery and Resolution Directive (the IRRD or the Directive). The Directive, which has to be transposed into national law by 28 January 2027, aims to establish a harmonised framework for crisis management in the European insurance sector, enhancing financial stability and policyholder protection.

Scope of the consultation

The proposals cover:

• Pre-emptive recovery plans: insurers will have to prepare detailed plans outlining corrective measures and crisis scenarios.
• Criteria for simplified obligations: conditions under which smaller or less complex undertakings can apply reduced requirements.
• Qualitative and quantitative indicators: capital and liquidity metrics to monitor financial soundness and trigger timely recovery actions.
• Independence of valuers: rules to ensure autonomy and impartiality of entities assessing assets and liabilities during resolution.
• Contractual recognition of stay powers: mandatory clauses allowing authorities to temporarily suspend contractual rights in resolution scenarios.
• Valuation of derivative liabilities: technical standards for determining the value of derivative positions under stress conditions.

Deadlines

• Public consultation: open until 20 March 2026 on EIOPA’s online portal.
• National transposition: by 28 January 2027.
• Directive application: January 2027.

The IRRD wants to create a consistent European approach to managing insurance failures, preventing systemic contagion and safeguarding policyholder interests. Insurers should start reviewing their recovery planning processes and contractual frameworks to comply with the upcoming requirements.

The consultation documents are available here.