Since their liberalization in the mid-1990s the eastern European insurance markets are among the most dynamic in the world. Even so, in terms of insurance density and penetration, they are still well behind the levels of their western neighbors.

The insurance market in the UK is by far the largest in Europe and the third largest in the world after the USA and Japan. As across the globe, the industry has been through turbulent times which have left deep scars in the individual insurance sectors.

The European Union's Solvency II project is confronting insurance supervisors with the need for a general revamp. Should the insurance industry go down the road already taken by the banking sector with Basel II? This fundamental issue must be resolved in the near future. The new supervisory structure will alter the regulatory framework within which the insurance industry operates, and this will have consequences for the economy as a whole.