Europe's insurance giants have quietly teamed up in a bid to stave off what they fear could be a hugely damaging backlash from regulators with the banking bonus scandal set to explode again as US investment banks prepare to report bumper profits.
Meetings have been held in several European capitals in a bid to co-ordinate efforts to ensure that insurers do not get caught in the crackdown currently in the process of being imposed on banks.
The Independent has learned that leading figures in the effort include Henri de Castries, chief executive of AXA, France's biggest insurer; Andrew Moss, who runs Britain's Aviva, and Alex Wynaendts, the chief executive of the Dutch insurance group Aegon.
They have privately agreed to co-ordinate efforts with both domestic and Europe-wide regulators.
It comes as the bonus scandal is set to be given fresh impetus by Goldman, which analysts expect to report pre-tax profits of $3.5bn (£2.2bn) on revenues of $12bn for the third quarter of the year. Nearly $6bn of that revenue is set to be divided among staff. Of them, 5,500 work in London.
The bonus pool is not decided until the end of December and is dependent on the full year's performance. But if Goldman hits targets, average compensation could hit more than $700,000 per employee – twice last year's payout, although that figure includes benefits such as health cover.
The insurance industry – traditionally a far more modest payer – has been eyeing the developments with increasing nervousness.
A major employer and tax payer for the UK, the industry has not been immune from the crisis that has rocked the world's financial markets and inflicted huge damage on the global economy. However it has managed to come through it in relatively robust health.
Several insurance groups came perilously close to insolvency following the steep falls in share prices precipitated by the dot com collapse in the early years of the decade.
But, reforms imposed then have meant insurers have largely avoided difficulties faced by banks although several have taken measures to conserve capital. In the UK, for example, both Legal & General and Aviva have cut their dividends to shareholders.
One executive at a leading insurance group, who asked not to be named, said: "It is going on behind the scenes and we are hopeful that the message is getting through to the regulatory authorities. We are keen that they understand the message that we are not the same as the banks and we are also in good financial health. The concern has been that imposing things such as requirements for insurers to hold much more capital could damage the sector and do more harm than good."
Insurance groups have, however, paid heed to the demands being imposed upon banks. Just last week Aviva announced the appointment of a director of risk reporting directly to the chief executive Andrew Moss, which brings the company into line with recommendations made by Sir David Walker in his review into the governance of the banking sector. The fact that the continent's biggest insurance companies, accustomed to competing aggressively with one another both for business and on the merger and acquisition front, are co-operating indicates the level of concern.Reuse content