Insurance-type cooperation mechanisms under EU law

Steinbach, Armin

Insurance-type cooperation mechanisms under EU law

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Citation

Steinbach, A. Insurance-type cooperation mechanisms under EU law. 2018. handle: http://hdl.handle.net/10230/35493

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Abstract

In the economic policy domain, calls for insurance-type cooperation within the European Monetary Union (EMU) have frequently been made. Insurance-type cooperation relates to the debate about macroeconomic stabilization tools helping to absorb asymmetric shocks within EMU. Adopting a legal perspective, this article aims explores the scope offered under the current EU treaties in establishing such cooperation mechanisms. Among the broad variety of policy proposals, we focus particularly on both a permanent EU unemployment scheme and a shock-based insurance. We identify the potential legal basis for these insurance schemes highlighting differences in legal feasibility given their specific design. We also discuss the endowment of insurance funds setting out four different funding modes under the EU treaties or on intergovernmental basis. We show that legal scope for insurance schemes is limited. Fully-fledged unemployment insurance schemes are likely to overstretch the boundaries of the EU treaties. More narrowly designed, however, such schemes are rather likely to be feasible if set up as shock-based mechanisms, where the gravity of the economic shocks is significant.