Insurance Europe has published a position paper in response to a European Commission consultation on its review of the definition of small and medium-sized enterprises (SMEs).

While acknowledging the value of having a common definition for genuine SMEs, Insurance Europe said that — due to the specific nature of insurance products and the business model of insurers — the current definition does not achieve its aims for insurers.

In particular, Insurance Europe warned that it could result in small and medium-sized insurers not being recognised as such. Therefore, the definition of SMEs should be amended to better reflect the insurance industry’s specificities. In particular:

• The balance sheet criterion should be replaced with technical provisions.
• The turnover criterion should be interpreted as the gross written premiums.
• Insurance specific thresholds should be set for both of these criteria.