(Bloomberg) — Insurers in Europe, which manage about 8.5trillion euros ($11.2 trillion) of client money, say their role aslong-term investors may be hurt by new regulation.

Planned new risk-based rules for insurers in the European Union,dubbed Solvency II, "still require the companies to holdinappropriately high amounts of capital against their long-terminvestments," Michaela Koller, director general of industry lobbygroup Insurance Europe, said in a statement.

"This will make it more expensive for insurers to invest inlong-term government and corporate bonds, as well asgrowth-stimulating activities, such as infrastructure projects,"Koller said.

Europe's regulators have said they won't relax rules designed toprotect customers from risk associated with investments ininfrastructure projects such as wind parks and power grids, GabrielBernardino, chairman of the European Insurance and OccupationalPensions Authority, or Eiopa, said in an interview in June.

Carriers including Allianz SE, Europe's biggest, argue the ruleswill deprive them of a new area of investment that could helpoffset low returns on fixed income, where they traditionally hadput most of their customers' money. The proposed level of capitalrequirements would put infrastructure and renewable energyinvestments in the same risk category as private-equity andhedge-fund commitments, which would be too high, they havesaid.

Discouraging insurers from making such investments "would have asignificantly negative effect on the European economy at a timewhen boosting growth is an overall policy objective," Kollersaid.

Europe leads

Last year, Europe maintained its ranking as the world's biggestinsurance market with 1.1 trillion euros in premiums, or 35 percentof the global market, compared with a 30 percent share for the U.S.and 28 percent for Asia, according to Insurance Europe.

Investments by European insurers increased 3.2 percent atconstant exchange rates last year, led by life insurance, whichaccounted for more than 80 percent of total, the lobby groupsaid.

Starting in 2016, the European Union plans to introduce SolvencyII. The rules specify how much capital firms must hold to meetfuture obligations and to safeguard customers' money. The EUreached an agreement in principle on Solvency II last year after 13years of wrangling with the industry, politicians and nationalregulators. Details including precise capital charges are stillbeing negotiated.